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Question
Why and by whom is an Income and Expenditure Account prepared?
Solution
- Non-trading organizations, such as non-profits, clubs, and societies, create an Income and Expenditure Account to record their financial success over a given time period.
- By summarizing their income and expenses, these organizations can determine whether they have a surplus or deficit, providing details about their financial health and overall efficiency.
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RELATED QUESTIONS
Income and expenditure contain only ______ items.
State any three points of difference between ‘Receipts and Payment Account’ and ‘Income and Expenditure Account’.
How will Income and Expenditure account benefit a non-trading sports organisation?
It contains only revenue items.
If the total of ______ side is greater than the total of ______ side, it is called 'surplus' or 'excess of income over expenditure'.
On the other hand, if the total of ______ side is greater than the total of ______ side, it is known as 'deficit' or 'excess of expenditure over income'.
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.
Mention any two features of the Income and Expenditure Account.
Give five differences between Profit and Loss Account and Income and Expenditure Account.
