Question

Write any three differences between Receipts and payments Account and Expenditure Account.


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Answer 1

Difference between Receipts and Payment Account And Income and Expenditure Account :-

Receipts and Payment Account -

1. It is a summarised statement of all cash transactions during an accounting year.
2. Only cash transactions are recorded here.
3. It's balance can never be credit.
4. It's preparation is not compulsory.

Income and Expenditure Account -

1. It is the account of revenue income and revenue expenditure of an accounting year.
2. Both cash and non-cash (credit) transactions are recorded here.
3. It's balance may be either debit or credit.
4. It is compulsory. It must be prepared in order to ascertain the true results of a concern.

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