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    Chapter - 1: Quick Revision Notes Accounting For Not-For-Profit Organisation General Formats

    Uploaded by

    Sadik Shaikh
    This document provides an overview of accounting formats and treatment of items for not-for-profit organizations. It discusses the formats for receipt and payment accounts, income and expenditure accounts, and calculation of capital funds. It also outlines the accounting treatment for items like subscriptions, donations, legacies, consumable goods, fund-based accounting, and honorariums. Key points covered include showing subscriptions received in advance as a liability and outstanding subscriptions as an asset, treating donations as income or capitalizing large amounts, and capitalizing legacies shown as liabilities.

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    Download as PDF, TXT or read online from Scribd

    Chapter - 1: Quick Revision Notes Accounting For Not-For-Profit Organisation General Formats

    Uploaded by

    Sadik Shaikh
    64 views3 pages
    This document provides an overview of accounting formats and treatment of items for not-for-profit organizations. It discusses the formats for receipt and payment accounts, income and expenditure accounts, and calculation of capital funds. It also outlines the accounting treatment for items like subscriptions, donations, legacies, consumable goods, fund-based accounting, and honorariums. Key points covered include showing subscriptions received in advance as a liability and outstanding subscriptions as an asset, treating donations as income or capitalizing large amounts, and capitalizing legacies shown as liabilities.

    Original Description:

    Accounts

    Original Title

    quickrevision_Accounts

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    This document provides an overview of accounting formats and treatment of items for not-for-profit organizations. It discusses the formats for receipt and payment accounts, income and expenditure accounts, and calculation of capital funds. It also outlines the accounting treatment for items like subscriptions, donations, legacies, consumable goods, fund-based accounting, and honorariums. Key points covered include showing subscriptions received in advance as a liability and outstanding subscriptions as an asset, treating donations as income or capitalizing large amounts, and capitalizing legacies shown as liabilities.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    64 views3 pages

    Chapter - 1: Quick Revision Notes Accounting For Not-For-Profit Organisation General Formats

    Uploaded by

    Sadik Shaikh
    This document provides an overview of accounting formats and treatment of items for not-for-profit organizations. It discusses the formats for receipt and payment accounts, income and expenditure accounts, and calculation of capital funds. It also outlines the accounting treatment for items like subscriptions, donations, legacies, consumable goods, fund-based accounting, and honorariums. Key points covered include showing subscriptions received in advance as a liability and outstanding subscriptions as an asset, treating donations as income or capitalizing large amounts, and capitalizing legacies shown as liabilities.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
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    The key takeaways are the different accounting formats used for receipts and payments, income and expenditure, and calculation of capital fund in not-for-profit organizations. It also discusses the accounting treatment for some important items like subscriptions, donations, legacies, and consumable goods.

    The different formats discussed are the format of receipts and payments account, format of income and expenditure account, and format for calculation of capital fund.

    Subscriptions received are credited to the income and expenditure account after preparing a subscriptions account to calculate the opening and closing balances of subscriptions received in advance and subscriptions outstanding.

    12 Accounts–XII

    CHAPTER – 1
    Quick Revision Notes

    ACCOUNTING FOR NOT-FOR-PROFIT ORGANISATION

    General Formats
    1. Format of Receipt and payment account

    Receipts Rs Payment Rs
    To balance b/d: By balance b/d
    Cash in hand ……… By Revenue Payment
    Cash at bank ……… Wages and Salaries
    To Revenue Receipts Rent
    Subscription ……… Rates and Taxes
    General donation ……… Insurance
    Sale of newspaper/periodicals/waste paper Printing and Stationary
    Sale of old sports material Postage and Courier
    Interest on fixed deposits ……… Advertisement
    Interest/dividend on general investment ……… Sundry Expenses
    Locker rent ……… Telephone Charges
    Sale of scraps ……… Entertainment Expenses
    Proceeds from charity show Audit Fees
    Miscellaneous receipts Honorarium
    Grant-in –aid Repair and Renewals
    To Capital Receipts : Upkeep of Ground
    Legacies Conveyance
    Life Membership Fee Newspapers and Periodicals
    Specific/Purpose Donation By capital Payment :
    Sale of Investment Purchase of Fixed Assets
    Sale of Fixed Assets Purchase of Investment
    Endowment Fund Fixed Deposits
    By Balance c/d :
    Cash in hand
    Cash at bank

    2. FORMAT OF INCOME AND EXPENDITURE ACCOUNT

    Expenditure Rs Income Rs.


    To all revenue payments after making By all revenue payments
    adjustment for outstanding and prepaid after making adjustment for
    exp.(current and previous year) outstanding and prepaid exp.
    To depreciation (current and previous year)
    To Bad Dept By profit on sale of fixed asset
    To Discount By deficit
    To Loss on Sale of Fixed Assets
    To Consumed Part of Medicine, Stationery,
    Sports Equipment etc.
    To Surplus
    Quick Revision 13

    3. Format for CALCULATION OF CAPITAL FUND

    Liabilities Rs Assets Rs.


    Creditors Cash in hand
    Bank overdraft Cash at bank
    Outstanding expenses in the beginning Subscription outstanding of
    of the current year previous year
    Subscription received in advance in the Opening stock of stationary,
    beginning of the year medicine etc.
    Capital fund(balancing fig being opening Prepaid expenses in the
    capital fund) beginning of the current year
    Books
    Furniture
    Machinery
    Investment

    Points to be remember for the accounting treatment of some important items of a N.P.O.
    1. Subscription – Subscriptions to be credited to Income & Expenditure A/c can be
    calculated by preparing an account as follows:
    Subscription A/c

    Particulars Rs. Particulars Rs.


    To subscription outstanding(opening By subscription received in
    balance) advance(opening balance)
    To Income & Expenditure A/c (Amt. to By Bank(Receipts & Payment
    be credited to income & exp. A/c ) A/c )
    To subscription received in By subscription
    advance(closing balance) outstanding(closing balance)

    Always remember a subscription received in advance is shown in the balance sheet as current
    liability and outstanding subscription is shown in the balance sheet as a current asset.
    2. Donations - If donations are general it can be treated either income (if the amount is
    small) or can be capitalized (if the amount is large).
    If the donation is for a specific purpose, it is capitalized and is shown in the liabilities side
    of the balance sheet.
    3. Legacies – These are the amount received by N.P.O. as per the WILL of a deceased
    person. It is always capitalized and shown in the liabilities side.
    4. Calculation of the cost of Consumable goods

    Particulars Amount
    Opening stock of consumable goods
    Add: consumable goods purchased during the year( cash & credit)
    Less: Closing stock of consumable goods
    consumable goods used during the year ( to be debited to Income & Expenditure A/c)

    OR
    14 Accounts–XII

    Particulars Amount
    Opening stock of consumable goods
    Add: Amount paid for consumable goods
    Add: Creditors for consumable goods(closing balance)
    Add: Advance paid for consumable goods(opening balance)
    Less: Creditors for consumable goods(opening balance)
    Less: Advance paid for consumable goods(closing balance)
    Less: Closing stock of consumable goods
    consumable goods used during the year ( to be debited to Income & Expenditure
    A/c)
    4. Fund based accounting – N.P.O. sometimes maintain separate Fund for specific
    activity such as tournament, prize match etc. In such cases, contributions, donations
    for, income, expenses of these activity are not recorded in Income & Expenditure A/c
    but are directly adjusted in specific fund A/c. If funds are more, balance is shown in the
    liabilities side of he balance sheet and if expenses are more, it is transferred to the debit
    of Income & Expenditure A/c.
    5. Honorarium – It is a token payment made to a person who voluntarily undertakes a
    service which would normally command a fee. It is shown as an expenditure in Income
    & Expenditure A/c.

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