Question

How do you prepare an income-expenditure account?

Answer 1

The preparation of how to make an income-expenditure record.

• Assortment of receipts and payments records of a non-exchanging venture whose Income and Expenditure account is to be made.

• Opening and closing balances relating to this receipt and installment record ought to be overlooked. Moreover, every payment of earlier years’ costs, just as that of a future year to come must be omitted. Capital payments of this current year are likewise overlooked.

• Each receipt relating to the earlier year’s income alongside that of the next year’s ought to be precluded from the posting. Furthermore, capital income for this current year is likewise disregarded.

• The current year’s incomes ought to be recorded, including the two consumptions and wages. Deterioration of fixed resources identified with income ought to likewise be thought about. Furthermore, benefit or misfortune on deals of resources is additionally considered as long as they are not a piece of this present association’s capital income.

• Both the final balances of income and expenditure ought to be determined. Net difference amount between these 2 proposes if a non-exchanging undertaking has an excess or deficiency balance.

Also see:

• Income and Expenditure Account
• Difference Between Capital Expenditure and Revenue Expenditure
• Classification of Expenditure

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