MCQs ON NON-PROFIT ORGANISATION

A Non-Profit organisation is a business that has been conceded tax-absolved status by the Income Tax Department of the Indian Government. This is because it facilitates a social reason and gives the public advantages and benefits. Gifts and donations made to a philanthropic association are commonly tax-deductible to people and organisations that make them, and the charity itself pays no expense or tax on the gifts or on any other cash acquired through raising support exercises.

Below is a list of multiple-choice questions and answers on Non-Profit Organisations to help students understand the topic better.

1. In the Income and Expenditure Account, all revenue receipts are entered on the ______.

a) Left-hand side.

b) Right-hand side.

c) Liability side.

d) Asset side.

Answer b) Right-hand side.

2. In the Income and Expenditure Account, all revenues expenses are entered on the ______.

a) Left-hand side.

b) Liability side.

c) Right-hand side.

d) Asset side.

Answer a) Left-hand side.

3. The task of preparing an Income and Expenditure Account and Balance Sheet begins after the preparation of _____.

a) Profit and Loss Account.

b) Trading Account.

c) Cash Account.

d) Trial balance.

Answer c) Cash Account.

4. In Receipts and Payments Account, cash in hand or at the bank is shown on the _____.

a) Left-hand side.

b) Right-hand side.

c) Credit side.

d) None of the options are correct.

Answer a) Left-hand side.

5. Income and Expenditure Account, generally indicates _____.

a) Cash Balance.

b) Capital Fund.

c) Net Profit / Loss.

d) Surplus / Deficit.

Answer d) Surplus / Deficit.

6. Donation received for a special purpose:

a) Should be credited to a separate account and shown in the Balance Sheet.

b) Should be shown on the Assets side of the Balance Sheet.

c) Should be credited to Income and Expenditure A/c.

d) None of the options are correct.

Answer a) Should be credited to a separate account and shown in the Balance Sheet.

7. Sale of the old newspaper is ______.

a) Revenue Receipt.

b) Asset.

c) Profit.

d) Capital receipt.

Answer a) Revenue Receipt.

8. Which of the following is an example of a Non-Profit organisation?

a) Corporations.

b) Audit Firms.

c) Insurance Companies.

d) Public Hospitals.

Answer d) Public Hospitals.

9. Surplus or profits of Non-Profit Organisations are _______.

a) It is not distributed among members.

b) Maybe or may not be distributed among members.

c) It is debited to the general fund.

d) Distributed among members.

Answer a) It is not distributed among members.

10. An Income and Expenditure Account is based on _______.

a) Accrual Basis of Accounting.

b) Mixed Basis of Accounting.

c) Management Accounting.

d) Cash Basis of Accounting.

Answer a) Accrual Basis of Accounting.

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