Question 1

Which of the following is not a not-for-profit organisation:&#10;A)School&#10;B)Hospital&#10;C)Club&#10;D)Partnership Firm

Accepted Answer

A partnership firm is a for-profit business entity formed by two or more individuals to conduct business and share profits.

Question 2

Subscription received during the year 50,000 Rs. Subscriptions outstanding at the end ofthe year 8,000 Rs. Subscription outstanding at the beginning of the year 6,000 Rs. Net Incomefrom subscription will be :

A)Rs 48000
B)RS 64000
C)RS 52000
D)RS 36000

RS 52000

Accepted Answer

Net Income from subscription = Subscription received during the year + Subscription outstanding at the end of the year - Subscription outstanding at the beginning of the year = 50,000 + 8,000 - 6,000 = Rs 52,000.

Question 3

In case specific fund is maintained, the expenses exceeding the amount of the funds, should be recorded on:&#10;A)Liabilities side of the Balance Sheet&#10;B)Debit side of the Income and Expenditure Account&#10;C)Credit side of the Income and Expenditure Account&#10;D)Assets side of the Balance Sheet

Accepted Answer

Expenses exceeding the amount of the specific fund should be recorded on the debit side of the Income and Expenditure Account as it represents an excess of expenditure over income.

Question 4

Income and Expenditure Account is:&#10;A)Personal Account&#10;B)Real Account&#10;C)Nominal Account&#10;D)None of these

Accepted Answer

Income and Expenditure Account is a type of Nominal Account because it records all income and expenses for a non-profit organization over a period of time, similar to the Profit and Loss Account for businesses.

Question 5

Life Membership Fees received by a club is shown in :&#10;A)Income and Expenditure A/c&#10;B)Balance Sheet&#10;C)Receipts and Payments A/c&#10;D)None of these

Accepted Answer

The answer of Life Membership Fees received by a club...

Question 6

Receipts and Payments Account is a :&#10;A)Personal Account&#10;B)Real Account&#10;C)Nominal Account&#10;D)None of these

Accepted Answer

Receipts and Payments Account is a Real Account because it records actual cash receipts and payments, which are real transactions involving the movement of cash or bank balances.

Question 7

Income and Expenditure Account is prepared :&#10;A)By Business Organisation&#10;B)By Industrial Organisation&#10;C)By Not-for-Profit Organisation&#10;D)By All Organisations

Accepted Answer

Income and Expenditure Account is specifically prepared by Not-for-Profit Organizations to ascertain their net surplus or deficit from operations during a particular period. It is similar to the Profit and Loss Account used by business entities but tailored for organizations that do not aim for profit.

Question 8

Payment of honorarium to secretary is treated as :&#10;A)Capital expenditure&#10;B)Revenue expenditure&#10;C)An income&#10;D)None of these

Accepted Answer

Payment of an honorarium to a secretary is considered a revenue expenditure because it is a regular payment for services rendered, affecting the operational expenses of a business rather than its capital assets.

Question 9

Outstanding subscription is a:&#10;A)Income&#10;B)Assets&#10;C)(a) and (b) Both&#10;D)None of these

Accepted Answer

Outstanding subscription refers to the amount of money that is due from members or subscribers for the period but has not yet been received by the organization. It is considered an asset because it represents future cash inflows. At the same time, it is also treated as income for the period in which it is due, affecting the income statement. Therefore, it is both an asset and income.

Question 10

Legacies should be treated as&#10;A)A Liability&#10;B)A Revenue Receipt&#10;C)An Income&#10;D)None of these

Accepted Answer

Legacies are treated as a liability because they represent an obligation that the recipient must fulfill.

Question 11

The excess of assets over liabilities in non-trading concerns is termed as:&#10;A)Capital Fund&#10;B)Capital&#10;C)Profit&#10;D)Net profit

Accepted Answer

The answer of The excess of assets over liabilities in...

Question 12

For a non-trading concern, honorarium paid is:&#10;A)An Income&#10;B)An Assets&#10;C)An Expense&#10;D)None of these

Accepted Answer

The answer of For a non-trading concern, honorarium paid is:&#10;A)An...

Question 13

Entrance fees, unless otherwise stated, is treated as:&#10;A)A Capital Receipt&#10;B)A Revenue Income&#10;C)A liability&#10;D)None of these

Accepted Answer

The answer of Entrance fees, unless otherwise stated, is treated...

Question 14

Specific donation is:&#10;A)Capital receipt&#10;B)Revenue Receipt&#10;C)Assets&#10;D)Liabilities

Accepted Answer

The answer of Specific donation is:&#10;A)Capital receipt&#10;B)Revenue Receipt&#10;C)Assets&#10;D)Liabilities...

Question 15

Income and Expenditure Account records transactions of:&#10;A)Capital nature only&#10;B)Revenue nature only&#10;C)(a) and (b) both&#10;D)None of these

Accepted Answer

The answer of Income and Expenditure Account records transactions of:&#10;A)Capital...

Question 16

Life membership fee received by a club is:&#10;A)Revenue Receipt&#10;B)Capital Receipt&#10;C)(a) and (b)&#10;D)None of these

Accepted Answer

The answer of Life membership fee received by a club...

Question 17

All receipts of capital nature are shown in :&#10;A)Income and Expenditure A/c&#10;B)Balance Sheet&#10;C)P. & L. A/c&#10;D)None of these

Accepted Answer

The answer of All receipts of capital nature are shown...

Question 18

All items of revenue in nature are shown in:&#10;A)Income and Expenditure A/c&#10;B)Balance Sheet&#10;C)(a) and (b) both&#10;D)None of these

Accepted Answer

The answer of All items of revenue in nature are...

Question 19

Which of the following is not a not-for-profit organisation ?&#10;A)College&#10;B)Sports Club&#10;C)Tata Automobiles&#10;D)Hospital

Accepted Answer

The answer of Which of the following is not a...

Question 20

Subscriptions received in advance by a club are shown on&#8230;&#8230;&#8230;&#8230;&#8230;..of the BalanceSheet&#10;A)Assets Side&#10;B)Liability Side&#10;C)Credit Side&#10;D)Debit Side

Accepted Answer

The answer of Subscriptions received in advance by a club...

Question 21

Which of the following is not an income ?&#10;A)Subscription&#10;B)Donation&#10;C)Sale of ticket&#10;D)Endowment Fund

Accepted Answer

The answer of Which of the following is not an...

Question 22

Subscription received by an organisation is:&#10;A)Capital Receipt&#10;B)Revenue Receipt&#10;C)Both (a) and (b)&#10;D)None of the above

Accepted Answer

The answer of Subscription received by an organisation is:&#10;A)Capital Receipt&#10;B)Revenue...

Question 23

Not-for-profit organisations are based on&#8230;&#8230;&#8230;&#8230;&#8230;&#8230;&#8230;&#8230;&#8230;&#8230;theory.&#10;A)Fund&#10;B)Surplus&#10;C)Profit&#10;D)Expenses

Accepted Answer

The answer of Not-for-profit organisations are based on&#8230;&#8230;&#8230;&#8230;&#8230;&#8230;&#8230;&#8230;&#8230;&#8230;theory.&#10;A)Fund&#10;B)Surplus&#10;C)Profit&#10;D)Expenses...

Question 24

The not for profit concerns prohibit the payment of any &#8230;&#8230;&#8230;&#8230;&#8230;&#8230;&#8230;&#8230;&#8230;to theirmembers&#10;A)Dividend&#10;B)Loss&#10;C)Assets&#10;D)Expenditure

Accepted Answer

The answer of The not for profit concerns prohibit the...

Question 25

The primary motive of Charitable Trust organizations is to provide&#8230;&#8230;&#8230;&#8230;&#8230;&#8230;&#8230;&#8230;.&#10;A)Fund&#10;B)Servive&#10;C)Profit&#10;D)Loss

Accepted Answer

The answer of The primary motive of Charitable Trust organizations...

Deck 4: Not-For-Profit Organizations and Financial Accounts