All the cash received is recorded on the Receipts and all the cash payments gets recorded in Payments side of the R & P Account. State the meaning of Receipt and Payment Account.Ī receipts and payments account (R & P Account) is a summary of actual cash receipts and payments that is extracted from the cash book over a certain time period. It helps in revealing the cash position of the organisation It does not include transactions that do not have cash or bank items.ĥ. It does not follow the double entry bookkeeping system as it is a summary of transactions.Ĥ. This account shows cash transactions that are of revenue and capital natureģ. It is known as cash book summary for NPO (Not-for-profit organisations) as it records all the cash and cash equivalents of the organisation.Ģ. The receipts and payments account has the following features:ġ. What are the features of Receipt and Payment Accounts? An NPO earns income from life membership fees, subscriptions, grants, donations etc. Some organisations that come under NPO are hospitals, religious organisations and trade unions. Organizations that are established with the aim of providing services to society and not profit earning are called as Not-for-profit Organisations (NPO). State the meaning of ‘Not-for-Profit’ Organisations. Less : Deficit from Income and Expenditure Account If any surplus amount is received from I & E account, it gets added to capital fund, likewise any deficit will be deducted from the same and is known as Accumulated Fund.Ĭalculating Capital Fund Capital Fund at the beginning of the yearĪdd : Surplus from Income and Expenditure AccountĪdd : Subscription Amount (Capitalised amount) This is similar to the concept of capital for an organisation working to earn profit. The scenario where value of assets of NPO are more than its liabilities, it is called as capital fund. What is Capital Fund? How is it calculated? 2nd Puc Accountancy Chapter 1 Notes 2nd Puc Accountancy Chapter 1 Accounting for Not-For-Profit Organization Part – 1 Notes 2nd Puc Accountancy Chapter 1 Notes Short Questions
0 kommentar(er)
