Tag: special issues associated with accounts of non-trading concerns

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Questions Related to special issues associated with accounts of non-trading concerns

Multiple choice book keeping and accountancy accounts of 'not for profit' concerns prepration of income and expenditure account accounting treatment for npo's special issues associated with accounts of non-trading concerns receipts and payments receipts and payments account financial accounting and reporting accounting procedure for not-for-profit organisations balance sheet, classification of assets and liabilities accounting records of not-for-profit organisations prepration of income and expenditure account and balance sheet

Rs. 1,00,000 received as the annual membership subscription. Out of this Rs. 20,000 is pertaining to the previous accounting period, whereas Rs. 10,000 is receivable at the end of the current accounting period. Calculate the amount of subscription that will be shown in the income and expenditure account for this accounting year.

  1. 80,000

  2. 90,000

  3. 1,20,000

  4. 1.00,000
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Subscription amount to be shown in income and expenditure account can be calculated using the formula given below:

 $Subscription\quad amount=\quad Subscription\quad received\ \quad \quad Add:\quad Subscription\quad received\quad at\quad end\quad of\quad year\ \quad Less:\quad Outstanding\quad subscription\quad for\quad previous\quad year$
Substitute values in the above equation
$Subscription\quad amount=\quad Rs1,00,000\ \quad \quad Add:\quad Rs10,000\ \quad Less:\quad Rs20,000\quad =Rs90,000$.

Multiple choice book keeping and accountancy accounts of 'not for profit' concerns prepration of income and expenditure account accounting treatment for npo's special issues associated with accounts of non-trading concerns receipts and payments receipts and payments account financial accounting and reporting accounting procedure for not-for-profit organisations balance sheet, classification of assets and liabilities accounting records of not-for-profit organisations prepration of income and expenditure account and balance sheet

Given : Stock of stationery on Jan. 1, 2015 Rs 200; payments for stationery during 2015 Rs 1,000; and stock of stationery on Dec. 31, 2015 Rs 50.
What will be the amount posted to Income and Expenditure A/c for the year ending Dec. 31, 2015?

  1. Rs 750

  2. Rs 850

  3. Rs 1,150

  4. Rs 1,250
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Stationery amount to be shown in income & expenditure account can be calculated using the formula given below:

$Stationery\quad amount=\quad Opening\quad stock-Closing\quad stock+Payments\quad made$
Substitute values in the above equation
$Stationery\quad amount=\quad Rs200-Rs50+Rs1000\quad =Rs1,150$.

Multiple choice book keeping and accountancy accounts of 'not for profit' concerns prepration of income and expenditure account accounting treatment for npo's special issues associated with accounts of non-trading concerns receipts and payments receipts and payments account financial accounting and reporting accounting procedure for not-for-profit organisations balance sheet, classification of assets and liabilities accounting records of not-for-profit organisations prepration of income and expenditure account and balance sheet

Income and Expenditure Account records income and expenditure item of ____________________.

  1. Booth capital and revenue nature.

  2. Only capital nature.

  3. Only revenue nature.

  4. Only revenue nature related to a particular accounting period.
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Income and Expenditure Account is prepared on an accrual basis. All incomes and expenses relating to the accounting year, whether they are actually received and paid or not, are taken into consideration. Expenditure is recorded on the debit side and income is recorded on the credit side. A distinction is made between capital and revenue items and only revenue items are included in this account.

Multiple choice book keeping and accountancy accounts of 'not for profit' concerns prepration of income and expenditure account accounting treatment for npo's special issues associated with accounts of non-trading concerns receipts and payments receipts and payments account financial accounting and reporting accounting procedure for not-for-profit organisations balance sheet, classification of assets and liabilities accounting records of not-for-profit organisations prepration of income and expenditure account and balance sheet

The income and expenditure account is prepared on the basis of __________ system of accounting.

  1. Basic

  2. Main

  3. Cash

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

Financial Accounting is based on dual system of accounting.Income & expenditure account is also based on this basic system of accounting.