Advanced financial accounting - Lecture 6: Non-Profit organizations

Advanced financial accounting - Lecture 6: Non-Profit organizations. The main topics covered in this chapter include: organizations that follows no proper accounting system; library receipt and payment account; preparation of income statement; function of expense method; nature of expense method;... Please refer to the lecture for details!

Accounting

FIN­611  

Main Ahmad Farhan 

Lecture­6 Non­Profit organizations 

1. Which  is  maintaining  proper  books  of 

accounts and follows double entry accounting  system.

2. Which  is  not  maintaining  proper  books  of 

accounts  and  not  follow  double  entry  accounting system.

Organizations that follows no proper Accounting system  

Library Receipt and payment Account  For the year ended 31st Dec, 2008 

Receipts  Cash  Bank Payments  Cash  Bank 

Opening balance

Subscription received 

Membership fee

Donations 

Loan received 

Any other income  

xxx xxx xxx xxx

­­­­

xxx

xxx xxx xxx xxx xxx

Telephone bill Rent 

Salaries  Entertainment  expenses

News paper & 

Periodicals  Any other  expenses  Closing balance 

xxx

­­­­

xxx xxx

xxx xxx xxx

­­­­ xxx

­­­­

­­­­

­­­­ xxx xxx

1. Function of expense method 

2. Nature of expense method 

Income statement under  Function of expense method 

Less Operating expenses 

Selling and marketing  xxx

xxx

1. Cost of goods sold 

2. Administrative expenses 

3. Selling and Distribution expenses 

4. Financial expenses

5. Income tax expenses 

Income

Subscription income   xxx 

Membership fee   xxx

Expenses

Electricity bill     xxx

Building rent     xxx

Excess of Income over 

Income Amount Expenditure Amount 

Subscription income   xxx 

Membership fee         xxx

Entrance fee          xxx

Entrance fee      Electricity bill      Building rent     

Excess of Income Over Expenditure /surplus  

xxx xxx xxx xxx

xxx