Concept and Terminologies of nonprofit organization, Receipt and payment account, Income and expenditure account, Balance Sheet, Preparation of final account for nonprofit organization
Every non-profit organization prepares balance sheets. Those sheets are prepare to the capital fund amount. There are two types of balance sheet they are opening balance sheet and closing balance sheet.
The non-trading concerns are the organizations which are established with a view to provide services to the society and not to make profits. The examples of such organization are sports, dub, school, hospitals, temples etc.
Receipt and Payment account is the summary of all the cash transaction which is recorded in cash book date wise at the end of the year. The organizations maintain the accounting system on cash basis which are recorded in cash book.
Income and expenditure is a nominal account which includes all revenue items. It is prepared same as profit and loss account i.e. on accrual basis. The difference of this account will represent surplus or deficit.