Christmas Exam Question

Question 1

The club is considering the installation of floodlights cost 70000
What advice would you give the treasurer

Answer 1

YES
-Would allow longer use of clubs courts(+income)
-Attract to new members
-Have paid off last loan so no loans to worry about
-Have surplus income over expenditure (34,894)
-Have 45,180 in bank
-Have 50,000 investment income
(Funds Available Without Reserve Fund)

Question 2

State 2 limitations of the receipts and payment account

Answer 2

• Does not show if the club is making enough money to cover its running costs
• Amount due but not paid at end of year not included
• Only shows increase or decrease in cash although there could be outstanding bills
• Does not take into account losses such as deprecation
• Does not show whether clubbar is profitable ornot
• does not distinguish between receipts for this year or other years