Question

. How would a not-for-profit organization deal with the following items. (a) Outstanding Subscriptions, (b) Donation, (c) Tournament Fund, (d) Legacy,(e) Life Membership fees

Answer 1

A)Outstanding Subscription Of that year is recorded on debit side of Income and Expenditure A/c and also shown in the Balance Sheet of Current year in the Assets Side.

B)There are two cases:

    1.General Donation-Shown in the credit side of Income and Expenditure  

       A/c

     2.Specific Donation-Shown in the Balance Sheet in Liabilities Side.

C) Tournament Fund will be treated in the liability side of Balance Sheet according to its Adjustments.

D)Legacy will be shown in Liability side of Balance Sheet.

E)Life membership fee will be shown in Liability side of Balance   Sheet.