14.2 The treasurer of the Crown Bowling Club disappeared on 31 March 20X3, taking with him the majority of the books and records of the club. The club’s year end is 31 March. At the request of the club’s committee you are asked to examine the financial implications of the treasurer’s disappearance. From discussions with the committee you learn that certain information relating to receipts and payments is recorded in the club’s minute-book. In addition you obtain duplicate bank statements, returned cheques and paying-in slips. Having examined these together with the accounts for the year ended 31 March 20X2, you assemble the following information:

1. The balance sheet as on 31 March 20X2 showed the following:

£ £

4,000 2,004 360 494 230 3,088 1,100 1,988

£5,988 Accumulated fund 1,988 Brewery loan 4,000

£5,988 Creditors comprise:

Amount due to brewery for supplies 852 Greenkeeper 1 amounts due for quarter 152 Steward J to 31 March 20X2 96

£1,100 2. The following summaries of the minute book provided by the secretary appear relevant:

(a) 11 June 20X2. The accounts for the year ended 31 March 20X2 were presented and approved. It was reported that one of the overdue subscriptions had been paid. The membership of the other five overdue members was deemed to lapse from 1 April 20X2. Payments to the greenkeeper and the steward totalling £248, which had been provided in the accounts, were approved. The subscription for the year ended 31 March 20X3 was fixed at £64 per member. There were 100 members (following the lapses referred to above). Bar sales totalled £5,800 in April and May and showed a gross profit of 32 per cent of sales.

(b) 11 September 20X2. There had been 94 entries for the annual competition. The entry fee was £4 per entrant. The prizes, two dozen bottles of sherry, were taken from the bar stock. The cost to the bar was £6 per bottle. The greenkeeper’s and steward’s quarterly payments totalling £248 had been paid for the quarter to 30 June. Sixty-five subscriptions had been received to date. Bar sales totalled £5,880 in June, July and August and showed a gross^profit of 28 per cent of sales.

(c) 12 December 20X2. Bar sales totalled £6,200 in September, October and November and showed a gross profit of 33 per cent of sales. The greenkeeper had resigned on 1 October and had been paid up to date. The steward had been paid, in cash, £96 for the quarter ended 30 September 19X2.

(d) 11 March 20X3. Bar sales totalled £6,800 in December, January and February and showed a gross profit of 31 per cent of sales. Two members had resigned without their subscriptions being received. All other subscriptions had been received.
3.Summarised copy bank statements for the year ended 31 March 20X3 show the following:
£ £
Opening balance 494 Receipts - cash and cheques 24,672 Payments 18,808 Closing balance _A358 £25,166 £25,166 The cheque payments comprise:
Greenkeeper and steward (quarter ended 31 March 20X2) 248 Part repayment of brewery loan (including interest of £400) 2,400 Brewery for supplies 1^444 Tawnmower 4gg Improvements to green and pavilion 2 428 Repairs 1*800 £18,808 4. The secretary informs you that certain payments for wines and spirits from a local super¬ market had been made from cash takings.
5. Four new members had joined in March 20X3 and had paid their subscriptions of £64 each for the year ended 31 March 20X4 direct to the secretary. Following the disap¬ pearance of the treasurer, the secretary had paid the steward’s two outstanding quarterly fees from this cash and had banked the balance in April 20X3.
6. As on 31 March 20X3 all fixed assets are to be revalued at £8,000. Depreciation is to be ignored.
7. The records for bar takings in March could not be located. In view of a rise in bar prices on 1 March 20X3 you estimate the gross profit would have been 34 per cent on sales. The supermarket confirmed that there were no purchases by the club during March 20X3. As on 28 February 20X3, £900 was due to the brewery for supplies. Stock at cost as on 28 February 20X3 was £1,840 and as on 31 March 20X3 £1,750. The brewery con¬ firmed that supplies of £1,456 were delivered to the club in March 20X3. The balance due to the brewery for supplies of £2,356 as on 31 March 20X3 was paid in April.
You are required to prepare an income and expenditure account for the year ended 31 March 20X3, identifying the amount of the treasurer’s defalcations, and a balance sheet as on that date.