Generally Income and Expenditure Account is prepared from the information contained in the Receipts and Payments Account along with the additional information. Items of incomes and gains are shown on its credit side, known as ‘Income’ side and items of expenses and losses should be shown on its debit side known as ‘Expenditure’ side. On the basis of accrual concept, revenue and expenditure should be recognized and shown in this account. Items which are revenue in nature (nominal accounts) and pertaining to the present accounting period are recorded in this account. Income and Expenditure Account is a nominal account and includes only those items which are revenue in nature. Meaning of Income and Expenditure Account: Let us make in-depth study of the meaning and features of Income and Expenditure Account of Not-For-Profit organisations.
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