Question

Analyse the accounting system is a non-profit organization?

answer

Non-profit accounting refers to the recording and reporting of business transactions of a non-profit organization. Such an entity one that has no ownership interests and has an operating purpose other than to earn a profit. It also receives significant contributions from third parties that do not expect a return. Here are some highlights.

· Net assets take the place of equity in the balance sheet, since there are no investors to take an equity position

· Net assets are classified as with donor restrictions or without donor restrictions. Assets without donor restrictions can be used for any purpose.

· A non-profit exists for a certain program. You can view the revenues and expenses associated with each program

· Costs are assigned to the management and administration classification, with the intent being to keep costs as low as possible

· Financial statements of a non-profit are different as the statement of activities replaces income statement and statement of financial position replaces the balance sheet.​

Answer 1

Answer:

Non-profit accounting refers to the recording and reporting of business transactions of a non-profit organization. Such an entity one that has no ownership interests and has an operating purpose other than to earn a profit. It also receives significant contributions from third parties that do not expect a return. Here are some highlights.

· Net assets take the place of equity in the balance sheet, since there are no investors to take an equity position

· Net assets are classified as with donor restrictions or without donor restrictions. Assets without donor restrictions can be used for any purpose.

· A non-profit exists for a certain program. You can view the revenues and expenses associated with each program

· Costs are assigned to the management and administration classification, with the intent being to keep costs as low as possible

· Financial statements of a non-profit are different as the statement of activities replaces income statement and statement of financial position replaces the balance sheet

Answer 2

Answer:

Explanation:

The recording and reporting of commercial transactions for a non-profit organization is referred to as non-profit accounting. One such entity is one that has no ownership stakes and operates for a goal other than making a profit. Additionally, it receives considerable contributions from unpaid third parties.

• Instead of keeping a capital account open, non-profit organizations keep a capital fund or general account open for accounting purposes. They deposit the surplus, life membership dues, gifts, bequests, etc. into this account.

• Receipt and Payment Account are a couple of the crucial financial accounts that a non-profit company should regularly create.

• Account for income and expenses or a statement of activity.

        the statement of financial position or the balance sheet prepared by              non profit organisations

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