Question

State whether the following statement is True or False with reasons.

Income and Expenditure Account represents either surplus or deficit.

Options

• True

• False

Answer 1

This statement is True.

Explanation:

All revenue incomes and expenses are recorded in the Income and Expenditure Account. At the end of the specified period, the difference is known as ‘Surplus’ (revenue incomes are more than revenue expenses) or ‘Deficit’ (revenue expenses are more than revenue incomes).