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Question
The closing balance of this account shows surplus/deficit ______.
Options
Profit & Loss Account
Receipts & Payments Account
Balance Sheet
Income & Expenditure Account
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Solution
The closing balance of this account shows surplus/deficit income & Expenditure Account.
Explanation:
Non-profit clubs and societies utilise the Income & Expenditure account to track income and expenses. During a set length of time, usually a financial year. This account's ending balance shows whether there is a surplus (if income exceeds expenditure) or a deficit (if expenditure exceeds income) for the given time.
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RELATED QUESTIONS
State any three points of difference between ‘Receipts and Payment Account’ and ‘Income and Expenditure Account’.
Give any two uses of Income and Expenditure Account.
How will Income and Expenditure account benefit a non-trading sports organisation?
How is Receipts & Payments Account different from Income & Expenditure Account?
The closing balance of this Account shows surplus or deficit for the year.
This account is equivalent to the Profit and Loss Account of a business concern.
It serves as the basis for preparing the Balance Sheet of a non-trading organisation.
Why and by whom is an Income and Expenditure Account prepared?
State any one point of difference between Receipt and Payment account and Income and Expenditure Account.
All donations received by non-trading concerns are entered in the liabilities side of the balance sheet. Justify either for or against.
