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Question
In case of a non profit organization life membership fee is treated as _____________.
In case of a non profit organization life membership fee is treated as _____________.
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Solution
The correct option is C capital receipt
Some organisations
provide its members an option to pay a lump sum amount to become members for
the whole life. The members opting for the life membership are not required to
pay periodic subscription. As this is received only once it is transferred to
the Capital fund Account in Balance Sheet because it creates liability for organisation.
Some organisations provide its members an option to pay a lump sum amount to become members for the whole life. The members opting for the life membership are not required to pay periodic subscription. As this is received only once it is transferred to the Capital fund Account in Balance Sheet because it creates liability for organisation.
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