Question

Difference between income and expenditure account and profit and loss account

Answer 1

Answer:

Explanation:

Income and expenditure account is prepared by not -for profit organization whose aim is not to earn money. ... Balance of Account . When we compare debit and credit side of this account, balance will be surplus or deficit. The balance of profit and loss account will be net profit or net loss

Answer 2

Answer!!

Difference between Income and Expenditure Account and Profit and Loss Account:-

→ The objective of Income and Expenditure Account is to determine surplus or deficit. The objective of Profit and Loss Account is to determine net profit earned or net loss incurred.

→ Income and Expenditure Account is prepared by Not-for-Profit Organisation (NPO). Profit and Loss Account is prepared by business enterprises.

→ Income and Expenditure Account is prepared from the Trial Balance or Receipts and Payments Account. Profit and Loss Account is prepared from Trial Balance and other information.  

→ The balance in the Income and Expenditure Account is termed as surplus or deficit. The balance in the Profit and Loss Account is termed as net profit or net loss.