Tag: financial accounting and reporting

Quizzes (5) Questions (51)

Questions Related to financial accounting and reporting

Multiple choice book keeping and accountancy accounting for not-for-profit organisation financial accounting and reporting prepration of income and expenditure account and balance sheet accounting procedure for not-for-profit organisations prepration of income and expenditure account

Given : Stock of stationery on Jan. 1, 2015 Rs 400
Stock of stationery on Dec. 31, 2015 Rs 100
Payment for stationery during 2015 Rs 1,200
Creditors for stationery on Dec. 31, 2015 Rs 150.
What is the amount of stationery that will be posted to the Income and Expenditure A/c for the year ending Dec. 31, 2015?

  1. Rs 1,150

  2. Rs 1,650

  3. Rs 850

  4. Rs 1,050
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Calculation of Amount of stationary for the year ended 31st March, 2015

Opening stock of stationary ,1st Jan 2015  =   400
+ Payment made during the year                =  1200
+ Creditors for stationary on 31st Dec         =  150
-  Closing stock as on 31st Dec ,2015          =  (100)
                                                                       =  1650 Rs.

Multiple choice book keeping and accountancy accounts of 'not for profit' concerns financial accounting and reporting prepration of income and expenditure account and balance sheet accounting procedure for not-for-profit organisations receipts and payments receipts and payments account

Subscription is paid___________.

  1. on weekly basis

  2. on daily basis

  3. on monthly basis

  4. on annual basis
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Subscription is a payment made to receive or be given access to certain services or information for a specific period of time. It is usually paid on annual basis. 

Multiple choice book keeping and accountancy accounts of 'not for profit' concerns financial accounting and reporting prepration of income and expenditure account and balance sheet accounting procedure for not-for-profit organisations receipts and payments receipts and payments account

Any donation received for a specific purpose is a ___________.

  1. Liability

  2. Assets

  3. Revenue Receipts

  4. Capital Receipts
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

If donation is received without a specific purpose, it is a revenue receipt. But if donation is received for a specific purpose, this is considered as capital receipts and all expenses incurred towards the specific purpose should be set off from this receipt.

Multiple choice book keeping and accountancy accounts of 'not for profit' concerns financial accounting and reporting prepration of income and expenditure account and balance sheet accounting procedure for not-for-profit organisations receipts and payments receipts and payments account

In case a sports fund is kept, expenses on account of sports events should be ____________.

  1. charged to sports fund

  2. charged to the income and expenditure account

  3. taken to the balance sheet on the asset side

  4. taken to the balance sheet on the liability side
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Specific funds are utilized for the specific activities only. If any sports events is organized, all expenses pertains to such event should be debited to sports fund account.

Multiple choice book keeping and accountancy accounts of 'not for profit' concerns financial accounting and reporting prepration of income and expenditure account and balance sheet accounting procedure for not-for-profit organisations receipts and payments receipts and payments account

What is Subscription?

  1. Life time fees

  2. Membership fee

  3. Cash

  4. Expence
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Subscription is an agreement to receive something for providing access to something. Membership fees is a subscription as a person pays money to become a member of an organisation and is usually paid annually. 

Multiple choice book keeping and accountancy accounts of 'not for profit' concerns financial accounting and reporting prepration of income and expenditure account and balance sheet accounting procedure for not-for-profit organisations receipts and payments receipts and payments account

According to sub-section 2 of Section 182 of the Companies Act 2013, which of the following is regarded as contribution for political purpose?

  1. Subscription given

  2. Donation given

  3. Expenditure incurred on advertiement

  4. All of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

As per section 182(2) of the companies act 2013 subscription, donation given and expenditure incurred on advertisement are all regarded as contribution for political purposes. 

Multiple choice book keeping and accountancy accounts of 'not for profit' concerns financial accounting and reporting prepration of income and expenditure account and balance sheet accounting procedure for not-for-profit organisations receipts and payments receipts and payments account

Which of the following consisting  the final account of a non-profit organization_____________.

  1. Trading and Profit & Loss A/c and Balance Sheet

  2. Income Statement and Statement of Financial Position

  3. Receipts & Payments A/c and Income & Expenditure A/c

  4. Receipts & Payments A/c Income & Expenditure A/c and Balance Sheet
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation
The statements prepared by Non-for-profit organisations are:-
1) Receipt and payments account - It is a real account just like cash account. Its prepared at the end of the year. All receipts are recorded on the debit side and expenses on the credit side. 
2) Income and expenditure account - Its a nominal account and is just like a profit and loss account. All the expenses are recorded on the debit and side and incomes on the credit side. 
3) Balance sheet - Balance sheet is prepared normally. The difference between assets and liabilities is shown as capital fund or general fund. 
Multiple choice book keeping and accountancy accounts of 'not for profit' concerns financial accounting and reporting prepration of income and expenditure account and balance sheet accounting procedure for not-for-profit organisations receipts and payments receipts and payments account

Entrance fee of Rs. 20,000 received by a club is a _____________.

  1. capital receipt

  2. revenue receipt

  3. capital expenditure

  4. revenue expenditure
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Clubs normally charge two kind of fee. Entrance fee and yearly contribution. 

Entrance fee is part of capital receipt and yearly contribution is revenue receipt. 

Entrance fee of Rs.20000 received by a club is a capital receipts. 

Multiple choice book keeping and accountancy accounts of 'not for profit' concerns financial accounting and reporting prepration of income and expenditure account and balance sheet accounting procedure for not-for-profit organisations receipts and payments receipts and payments account

Statement I: Receipt & Payment A/c starts with the opening balance of cash in hand and at bank.
Statement II: Income & Expenditure A/c have no opening balance.
Select the correct answer the options given below.

  1. Statement I is Correct while statement II is Incorrect.

  2. Both Statement I and II are incorrect

  3. Statement II is Correct while statement I is incorrect.

  4. Both Statement I and II are correct
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Receipt and Payment account is a summary of cash transactions and starts with an opening cash/bank balance. Income and Expenditure account is like a Profit and Loss account, which is prepared for a specific period and does not carry forward an opening balance.

Multiple choice book keeping and accountancy accounts of 'not for profit' concerns financial accounting and reporting prepration of income and expenditure account and balance sheet accounting procedure for not-for-profit organisations receipts and payments receipts and payments account

An advance receipt of subscription from a member of the non profit organization is considered as a/an _______________.

  1. Expense

  2. Liability

  3. Equity

  4. Asset
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Subscription is the amount that is paid by members of NPO every year. It is the primary source of income of NPO. It is generally paid every month. It is the amount paid by members to keep their membership alive. An advance receipt of subscription from a member is an income received in advance. So it is treated as liability.