Question

0.2. Not-for-Profit Organisations have some distinguish features from that of profit organization.state one of them?​

Answer 1

Answer:

Usually, every business undertakes economic activities with a motive to earn a profit. But, there are some organizations which work with a motive to provide service to its members as well as to the general public. The trustees of these organizations are fully accountable to the members and the public. Hence, Accounting for Non-Profit Organizations become necessary. Examples of such organisations are charitable institutions, religious organisations, clubs, educational institutions, trade unions, etc.

Explanation:

Meaning, Characteristics, and Accounting for Non-Profit Organizations

Not-for-Profit Organisations are organisations which are set up for the welfare of the society or for the promotion of art and culture in the society. These are usually set up as a charitable institution with the service motive. The trustees manage these organisations. The members of the organisation elect the trustees. The Not-for-Profit Organisations raise funds from its members as well as from the general public for meeting their objectives.

The main motive of these organisations is to provide service. However, they may earn profits in the due course. Generally, these organisations do not manufacture, purchase or sell goods or provide services. Thus, they do not need to prepare Trading and Profit and Loss A/c. They credit the funds received to the Capital Fund or General Fund

Meaning, Characteristics and Accounting for Non Profit Organizations

Usually, every business undertakes economic activities with a motive to earn a profit. But, there are some organizations which work with a motive to provide service to its members as well as to the general public. The trustees of these organizations are fully accountable to the members and the public. Hence, Accounting for Non-Profit Organizations become necessary. Examples of such organisations are charitable institutions, religious organisations, clubs, educational institutions, trade unions, etc.