Comparing items on _ side of the Receipts and Payment Account with side of the Income and Expenditure account is one of the step adopted in preparation of balance sheet.

payments, income

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receipts, payments

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receipts, income

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receipts, expense

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Solution

The correct option is C receipts, income
Receipts and Payments Account records all the amounts received and paid during the year. Income and Expenditure records all incomes and expenses relating to this year whether actually income received or not and expenses paid or not.
Comparing items on receipt side of Receipt and Payment Account with income side of Income and Expenditure Account tells us about whether any income is outstanding or received in advance.

Outstanding income is recorded on asset side of balance sheet and income received in advance is recorded on liabilities side of balance sheet.

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Similar questions

What steps are taken to prepare Income and Expenditure Account from a Receipt and Payment Account?

Q. (I) In Receipt & Payment A/c all receipts and payments are shown irrespective of the year to which they pertain.
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(III) Income & Expenditure A/c is always accompained by balance sheet.

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Q. What is the correct sequence of the preparation of the following accounts and statement of a non-profit organisation?
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Q. A receipts and payments account, the payments are recorded on the ____________ side.

Following is the Receipt and Payment Account of Indian Sports Club, prepared Income and Expenditure Account, Balance Sheet as on December 31, 2006:

Receipt and Payment Account for the year ending December 31, 2006
Receipts	Amount Rs	Payments	Amount Rs
Balance b/d	7,890	Salary	11,000
Subscriptions	52,000	Electric charges	5,500
Life member ship fee	2,200	Billiard Table	17,500
Entrance fee	3,200	Office expenses	4,100
Tournament fund	26,000	Printing and Stationery	2,300
Locker Rent	1,250	Tournament expenses	18,500
Sale of old sports goods (Costing Rs 2,200)	2,500	Repair of ground	2,000
Sale of Old Newspaper	750	Furniture purchased	7,700
Legacy	37,500	Sports equipments	12,000
		Cash in Hand	12,690
		Cash at Bank	10,000
		Fixed Deposit (on 1.10.06 for 10% p.a)	30,000

	1,33,290		1,33,290

Other Information:

Subscription outstanding was on December 31, 2005 Rs 1,200 and Rs 3,200 on December 31, 2006. Locker rent outstanding on December 31, 2006 Rs 250. Salary outstanding on December 31, 2006 Rs 1,000.

On January 1, 2006, club has Building Rs 36,000, furniture Rs 12,000, Sports equipments Rs 17,500. Depreciation charged on these items @ 10% (including Purchase).

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Comparing items on _________ side of the Receipts and Payment Account with ________ side of the Income and Expenditure account is one of the step adopted in preparation of balance sheet.

Comparing items on _ side of the Receipts and Payment Account with side of the Income and Expenditure account is one of the step adopted in preparation of balance sheet.