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Income and Expenditure Account

What is the c...

Question

What is the correct sequence of the preparation of the following accounts and statement of a non-profit organisation?
I. Income and expenditure account
II. Receipts and payment account
III. Balance sheet
Select the correct answer from the codes given.

A

I, II, III

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B

I, III, II

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C

II, I, III

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D

II, III, I

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Solution

The correct option is C II, I, III
In case of Non-Profit organisations first receipts and payments accounts are prepared then income and expenditure account and lastly balance sheet is prepared. Receipts and payments account is prepared first because it helps in preparation of income and expenditure account.

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Q. Match List-I(financial statements and accounts) with List-II(special matters associated with statements and accounts) and select the correct answer using the codes given the lists.

List-I	List-II
I. Receipts and payments	(a) Revenue account
II. Income and expenditure account	(b) Cash
III. Dividend equalisation reserve	(c) Liability
IV. Club subscription received in advance account	(d) Balance Sheet
	(e) General reserve

Q. Receipts and Payments Account is prepared on -
(I) Accrual basis of accounting
(II) Cash basis of accounting
(III) Hybrid basis of accounting
The correct answer is -

Q. Income & Expenditure A/c is prepared by transfer of :
(I) Nominal accounts
(II) Real accounts
(III) Personal accounts
The correct answer is ___________________.

Q. Which of the following statement is correct and which is incorrect ?
(I) In Receipt & Payment A/c all receipts and payments are shown irrespective of the year to which they pertain.
(II) The difference at Dr. side of Receipt & Payment A/c account is known as surplus or deficit and deducted from capital fund.
(III) Income & Expenditure A/c is always accompanied by balance sheet.
(IV) Going concern assumption is not relevant for accounting of non-profit organization.
Select the correct answer from the options given below.

Q. (I) In Receipt & Payment A/c all receipts and payments are shown irrespective of the year to which they pertain.
(II) The difference at Dr. side of Receipt & Payment A/c account is known as surplus or deficit and deducted from capital fund.
(III) Income & Expenditure A/c is always accompained by balance sheet.

Select the correct answer.

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