How is ‘Life membership fee’ treated while preparing the financial statements of a not-for-profit organisation ?

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Solution

Life membership fees is a capital receipt and is therefore added to the capital fund in the Balance Sheet on the liabilities side.

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Similar questions

why is life membership fees treated as liability?

Show the accounting treatment of the following items by a Not-for-Profit organisation.

(i) Annual Subscription

(ii) Specific Donation

(iii) Sale of Fixed Assets

(iv) Sale of Old Periodicals

(v) Sale of Sports Materials

(vi) Life Membership Fee

How will you treat sale of old newspapers while preparing the final accounts of a non-profit organisation?

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