Question

Income and Expenditure Account is equivalent to ____________.

• A. Profit and Loss Account
• B. Receipts and Payments Account
• C. Balance Sheet
• D. Receipts and Expenditure Account

Answer 1

The correct option is A Profit and Loss Account

Income and Expenditure account prepared by non trading concerns is very much like the profit and loss account prepared by trading concerns. Both account shows the expenditure incurred and income earned during the year. In the end balance is calculated. In Income and Expenditure account balance is termed surplus or deficit and in Profit and loss account it is termed "Net Profit" or "Net Loss".