Accounting procedure for not-for-profit organisations - class-XI
|Description: accounting procedure for not-for-profit organisations|
|Number of Questions: 21|
|Created by: Jayanti Mahajan|
|Tags: accounts of non-trading organisations elements of accounts financial statements of not-for-profit organisations accountancy accounting for not-for-profit organization accounts of non-trading concerns accounting for not-for-profit organisation accounting for non trading organisations and professional persons commercial applications book keeping and accountancy financial accounting and reporting accounting for not-for-profit organizations accounts of not-for-profit organisation accounts of 'not for profit' concerns|
Surplus revealed by Income and expenditure account ___________.
b'Income and expenditure account can be defined as an account that reveals surplus or deficit of a non-trading concern by matching incomes and expenses of a specified accounting period. The balance of income and expenditure account is transferred to the balance sheet. Surplus balance is added to the capital fund in balance sheet. '
Income and Expenditure Account is prepared on ____________.
Income and expenditure account is prepared on Accrual basis. Accrual basis of accounting is wherein all the expenses that are actually incurred and incomes actually earned are recorded. Its recorded when its realised and not when received.
Professional people like solicitors, doctors, company secretary, cost accountant, chartered accountants etc., prepare for themselves ___________ which is a modified form of Income & Expenditure A/c prepared by non-trading concerns.
Income and Expenditure account prepared by non-trading concerns is very much like the profit and loss account prepared by trading concerns. Both accounts show 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".
Income and Expenditure Account is equivalent to ____________.
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".
Which of the following is the accounting equation for a non-profit organization ?
Accounting equation is a statement representing a relationship between a company's assets, liabilities and its capital.
The capital of a non-profit organization is generally known as __________.
The capital for a non-profit organisation is not funded by the owner and thus has to be mentioned as capital fund. This is because capital fund is that account which records all those transactions which are related to capital nature.
Surplus of Income and Expenditure Account is deducted from the capital/general fund.
False. Surplus of Income and expenditure account is added to the capital/general fund. Surplus is arrived when there is excess of income over expenditure hence it is addition to the and fund and should be added to the capital fund.
State True or False:
Scholarships granted to students out of funds provided by government will be debited to Income and Expenditure Account.
False. Scholarships granted to students out of funds provided by government will be deducted from the fund provided by government. If there appears any fund respective incomes/expenses will added/deducted from the respective fund.
If there appears a sports fund, the expenses incurred on sports activities will be shown on the debit side of Income and Expenditure Account.
False. If there appears a sports fund, the expenses incurred on sports activities will be deducted from the sports fund. If there appears any fund respective incomes/expenses will added/deducted from the respective fund.
Income and expenditure accounts show ______________.
Income and Expenditure account is prepared to calculate the surplus or deficit with the company for current accounting period. The previous year transaction and the various cash transactions are not considered while preparing this account beacuse such transaction are related to receipt and payment account.
Given : Stock of stationery on Jan. 1, 2015 Rs 400
Stock of stationery on Dec. 31, 2015 Rs 100
Payment for stationery during 2015 Rs 1,200
Creditors for stationery on Dec. 31, 2015 Rs 150.
What is the amount of stationery that will be posted to the Income and Expenditure A/c for the year ending Dec. 31, 2015?
Calculation of Amount of stationary for the year ended 31st March, 2015
Subscription is paid___________.
Subscription is a payment made to receive or be given access to certain services or information for a specific period of time. It is usually paid on annual basis.
Any donation received for a specific purpose is a ___________.
If donation is received without a specific purpose, it is a revenue receipt. But if donation is received for a specific purpose, this is considered as capital receipts and all expenses incurred towards the specific purpose should be set off from this receipt.
In case a sports fund is kept, expenses on account of sports events should be ____________.
Specific funds are utilized for the specific activities only. If any sports events is organized, all expenses pertains to such event should be debited to sports fund account.
What is Subscription?
Subscription is an agreement to receive something for providing access to something. Membership fees is a subscription as a person pays money to become a member of an organisation and is usually paid annually.
According to sub-section 2 of Section 182 of the Companies Act 2013, which of the following is regarded as contribution for political purpose?
As per section 182(2) of the companies act 2013 subscription, donation given and expenditure incurred on advertisement are all regarded as contribution for political purposes.
Which of the following consisting the final account of a non-profit organization_____________.
Entrance fee of Rs. 20,000 received by a club is a _____________.
Clubs normally charge two kind of fee. Entrance fee and yearly contribution.
Statement I: Receipt & Payment A/c starts with the opening balance of cash in hand and at bank.
Statement II: Income & Expenditure A/c have no opening balance.
Select the correct answer the options given below.
An advance receipt of subscription from a member of the non profit organization is considered as a/an _______________.
Subscription is the amount that is paid by members of NPO every year. It is the primary source of income of NPO. It is generally paid every month. It is the amount paid by members to keep their membership alive. An advance receipt of subscription from a member is an income received in advance. So it is treated as liability.
The ______________ is the summary of cash and bank transactions which helps the preparation of Income and Expenditure account and Balance Sheet.
The Not-for-Profit Organisations are required to prepare financial statements at the end of the each accounting period and the general principles of accounting are fully applicable in their preparation. The final accounts of a not-for-profit organisations consist of the following: