Skip to content

CA Foundation · Accounting · Financial Statements of Not-for-Profit Organisations

In the Income and Expenditure Account of a not-for-profit organisation, which of the following is shown on the income side?

Entrance fees treated as revenue income appear on the income side of the Income and Expenditure Account. The other items, sale of furniture, purchase of a computer and loan repayment, are capital in nature and go to the Balance Sheet, not to this revenue account.

  1. AEntrance fees received from new members, where the organisation treats them as revenue incomeCorrect
  2. BProceeds from sale of old furniture
  3. CPayment for purchase of a new computer
  4. DRepayment of a bank loan

Explanation

The Income and Expenditure Account records only revenue items. Entrance fees treated as revenue are income. Sale proceeds of furniture are a capital receipt, while purchase of a computer and loan repayment are capital payments, so none of those appear in it.

Did you get it right without looking?

One question tells you little. A timed set on Financial Statements of Not-for-Profit Organisations shows your real accuracy, how long you take and where you lose marks.

Practise Financial Statements of Not-for-Profit OrganisationsFree diagnostic mock

More Financial Statements of Not-for-Profit Organisations questions