Question

anyalse the accounting system in a non profit organisation

Answer 1

Answer:

1. 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.

Answer 2

We can observe so many examples of a small size non - profit organizations around us ,very commonly understood examples will be of street

library where cash book would have been maintained as the only book of account and finally a summary of that cash book is prepared and the end of the year just to have an overview of the total receipts and payment made during the year because of the very simple and few transaction , it's members don't need to know

it's financial position at the end of each accounting period therefore income & Expenditure account and balance sheet is not prepared . Large size non - profit organizations .on the contrary , members of large size organizations Will be interested in all financial result of the entity and a proper book - keeping system is developed over there the out come of which is production of a trial balance which is used to prepare income & expenditure account and balance sheet

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