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Questions
Give two/three uses of Receipts and Payments Account.
Mention any two uses of Receipts and Payments Account.
Solution
The main uses of Receipts and Payments Account are as follows:
- Receipts and Payments Account serves as the basis for preparing the Income and Expenditure Account and the Balance Sheet.
- It alerts the management of a non-trading organisation about decline in cash receipts and increase in cash payments.
- It informs the members about main sources of income and major items of payments of their organisation.
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RELATED QUESTIONS
The objective of preparing a ______ account is to find out the cash position of the organization.
Write any two features of the Receipt and Payment Account.
All cash payments are recorded on the ______ side of the receipt and payment accounts.
The primary objective of preparing this Account is to find out the cash position, opening and closing balances of cash in hand and at bank.
It alerts the management of a non-trading organisation about decline in cash receipts and increase in cash payments.
Receipt and payment account has the following limitation(s).
It contains both capital and revenue items.
Receipt and Payment account is a _____ account.
Mention any two features of Receipts and Payments Account.
What is Receipts and Payments Account?
