Club Accounts Included among the assets and liabilities of the Glen Tennis Club on 1/1/2010 were the following: Clubhouse and courts €250,000, equipment (at cost) €75,000, bar stock €15,280, bar debtors €1,280, bar creditors €8,400, life membership €24,000, levy reserve fund €20,000, wages prepaid €40, subscriptions €500 - Leaving Cert Accounting - Question 6 - 2011

The Income and Expenditure Account for the year ending 31/12/2010 can be summarized as follows:

Income:

1. Bar profit: Calculated as total bar receipts less bar purchases. ( \text{Profit} = \text{Bar Receipts} - \text{Bar Purchases} = €12,000 - €38,500 = -€26,500 )
2. Interest from investments: €7,500
3. Subscriptions: Add life memberships, the total calculated as stated previously.
4. Annual Sponsorship: €2,500
5. Site membership written off can be noted as a deduction in the expense section later.

Total Income = Profit + Interest + Sponsorship Total Income = -€26,500 + €7,500 + €24,000 + €2,500 = €7,500

Expenditure:

The total expenditure must encompass operating expenses and write-offs. Include catering losses, sundry expenses, coaching lessons, and any depreciation required as per the previous calculations:

Add up all costs to derive total expenditure.

Surplus = Income - Expenditure

This will indicate overall profitability for the period.

The Balance Sheet as at 31/12/2010 will break down assets and liabilities appropriately:

ASSETS

• Fixed Assets: Include the clubhouse, courts, and equipment, accounting for depreciation.
• Current Assets: bank current account, closing stock, debtors, bar stock.

Total Assets = Sum of fixed and current assets minus depreciation amounts entered.

LIABILITIES

• Bar creditors, life membership file, and other obligations.

Total Liabilities = Include all credits and liabilities due.

Accumulated Fund = Total Assets - Total Liabilities

Summarize the balance and ensure correct totals are reflected for both sides, ensuring the balance sheet is balanced.

The Receipts and Payments Account has notable limitations:

1. Cash Basis: It only records cash received and payments made during a specific period. Thus, it doesn't reflect the club's actual financial position by ignoring unpaid income and accrued expenses.
2. Lack of Profitability Insight: The account only shows cash flows and does not present a true view of profitability or financial performance, as it does not separate income from receipts or categorize payments distinctly.

These limitations may lead to misleading conclusions about the financial health of the club.

I would advise the Treasurer to consider the following factors before proceeding with the installation of floodlights:

1. Cost-Benefit Analysis: Evaluate the projected increase in membership and usage of courts after installing floodlights, which can offset the cost.
2. Funding Options: Identify potential funding sources or grants designed for sports facilities and assess the club's ability to repay loans taken to finance the installation.
3. Long-Term Planning: Understand the maintenance costs associated with floodlights and ensure that they align with the club’s budget and long-term financial goals.