Tag: accounting treatment for npo's

Questions Related to accounting treatment for npo's

The capital of a non-profit organization is generally known as __________.

commercial applications financial accounting and reporting balance sheet, classification of assets and liabilities accounting records of not-for-profit organisations accounting procedure for not-for-profit organisations prepration of income and expenditure account and balance sheet income and expenditure account prepration of income and expenditure account accounting treatment for npo's

  1. Equity

  2. Accumulated fund/Capital fund

  3. Cash fund

  4. Financial reserve

Show answer
Correct Option: B
Explanation:

The capital for a non-profit organisation is not funded by the owner and thus has to be mentioned as capital fund. This is because capital fund is that account which records all those transactions which are related to capital nature.