Question

Select the most appropriate answers from the alternatives given below and rewrite the sentences.

In case of non trading concern the excess of assets over liabilities is termed as _____________.
a) surplus
b) deficit
c) capital fund
d) loan

Answer 1

In case of non trading concern the excess of assets over liabilities is termed as capital fund.

Explanation: Excess of assets over liabilities, in case of a not-for-profit organisation, is called capital fund. It is same as capital, which is calculated in case of profit-seeking entities. Opening capital fund is calculated by deducting opening liabilities from opening assets. It is shown on the Liabilities side of the Balance Sheet.