Many candidates performed well in this question but some candidates could not describe b (i) and b (ii)
The expected description are:
Receipts and Payments Account
- It shows the summary of the cash transactions of not-for-profit making
organization over a particular period of time.
- Capital receipts and payments, revenue receipts and payments are included
- All revenue are debited while all expenditure are credited.
- Its balance is either a current asset or a current liability.
Income and Expenditure Account
- This account is used to record the income accruing to a not-for-profit making organization for a period and its expenditure for the same period.
- All items of capital nature are excluded. Only revenue items are included.
- It operates on accrual basis.
- All expenditure are debited while all income are credited.
- Its closing balance is either a surplus or a deficit.
Section B (Practice of Financial Accounting)