Question

Specific donations received by a non-trading concern is called a _________.

• A. Revenue Receipt
• B. Capital Receipt
• C. Capital Expenditure
• D. Revenue Expenditure

Answer 1

Answer: (B)

Capital Receipt

Donation is the main source of income for non trading organization. It is considered as receipt in the receipt and payment account and as income in income & expenditure account.

If any specific donations are received to cover up the expense of the specific activity then this should be considered as capital receipts. Only specific activity must be performed against the specific donation and all related expenditure to be adjusted from this specific donation.