Question

why do we prepare income and expenditure account in place of profile and loss account for non trading organization?

Answer 1

because instead of being a not for PROFIT org. they want to know the surplus earned by them

but as P andL A/c show profit, they make I and E A/c as the primary motive of them is to render service than to earn profit

Answer 2

this is because in npo their main motive is to profit and PsL a/c find the profit earn during the year while as INC s exp shows surplus during the year . And this is the only reason behind this.