Tag: accounting for not-for-profit organisation

Non profit organization are those which have no motive to earn any profit. Donations received by these organization is usually a revenue receipts.

Income and expenditure account of a non-profit organisation is a nominal account. Nominal account record all the revenues, losses, gain and expenses. An income and expenditure account is just like a profit and loss account. Nominal accounts have no balance at the end of the year.

Receipts and payments Account is prepared by Non-Trading concerns. It acts like a cash account for the Non-Trading Concerns and helps in the making of income and expenditure of account which will show the deficit and surplus of the concern.

Receipt and Expenditure is simply a summary of the cash transactions as in the cash book, analyzed and classified under suitable heading, including the opening and closing balances.

The Receipt and Payment account starts with opening balance of cash and bank and end with the closing balance of cash and bank. 

A receipt and payment account generally shows a debit balance. To ascertain any missing item of receipt or payment, generally cash book summary is prepared.

Receipt and Payment account is a summary of cash/bank transactions of NPO for specialized accounting period. This Statement records both capital and revenue nature items.

Receipt and Payment account is a summarized statement of all cash transactions during an accounting year. Income and Expenditure account is the account through which surplus or deficit of a non-profit-seeking concern is ascertained.