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Question
It serves as the basis for preparing the Balance Sheet of a non-trading organisation.
Options
Receipts and Payments Account
Income and Expenditure Account
Balance Sheet
None of these
Solution
Income and Expenditure Account
Explanation:
The Income and Expenditure Account serves as the basis for preparing a non-trading organization's balance sheet. The surplus or deficit derived from the Income and Expenditure Account is added to or subtracted in the Balance Sheet.
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RELATED QUESTIONS
Justify either for or against by giving a reason for the following statement. ‘Income and Expenditure account shows the opening and closing balances of cash in hand and cash at bank.’
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______ account is prepared to ascertain surplus or deficit at the end of an accounting year.
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