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Zorluk: KolayCalculation of Accumulated Fund

The following balances were retrieved from the records of Apex Professional Association at the beginning of the financial year:

- Equipment: N200,000\text{N}200,000
- Bank balance: N40,000\text{N}40,000
- Subscriptions in arrears: N10,000\text{N}10,000
- Subscriptions received in advance: N5,000\text{N}5,000
- Accrued electricity expense: N20,000\text{N}20,000

What is the accumulated fund of the association?

  1. N225,000\text{N}225,000Cevap
  2. B
    N275,000\text{N}275,000
  3. C
    N235,000\text{N}235,000
  4. D
    N245,000\text{N}245,000

Cevap

N225,000\text{N}225,000
The accumulated fund is equivalent to capital in a profit-making entity, defined as total assets minus total liabilities. Adding equipment (N200,000\text{N}200,000), bank balance (N40,000\text{N}40,000), and subscriptions in arrears (N10,000\text{N}10,000) gives total assets of N250,000\text{N}250,000. Deducting total liabilities comprising subscriptions in advance (N5,000\text{N}5,000) and accrued electricity expense (N20,000\text{N}20,000) gives an accumulated fund of N225,000\text{N}225,000.

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1
Calculate Total Assets
Total Assets = Equipment (N200,000\text{N}200,000) + Bank balance (N40,000\text{N}40,000) + Subscriptions in arrears (N10,000\text{N}10,000) = N250,000\text{N}250,000
Assets represent all economic resources owned by or owed to the organization.
2
Calculate Total Liabilities
Total Liabilities = Subscriptions in advance (N5,000\text{N}5,000) + Accrued electricity expense (N20,000\text{N}20,000) = N25,000\text{N}25,000
Liabilities represent all amounts owed by the organization to external parties or members.
3
Compute Accumulated Fund
Accumulated Fund = Total Assets (N250,000\text{N}250,000) - Total Liabilities (N25,000\text{N}25,000) = N225,000\text{N}225,000
The accumulated fund of a non-profit organization represents the excess of assets over liabilities.

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Calculation of Accumulated Fund

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