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in Class 12 by kratos

State few points to be considered while preparing the balance sheet of non-trading organization.

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+6 votes
by kratos
 
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Following points are to be considered while preparing the Balance Sheet of a non-trading organization :

(1) On assets side of the Balance Sheet, furniture, bank and cash balances, etc. will appear along with items like prepaid expenses and accrued incomes following the marshalling patterns of Balance Sheet.

(2) On the liabilities side, will appear usual items of creditors for supply, outstanding liabilities for expenses along with various fund balances and the capital account.

(3) The assets appearing in the previous year'* Balance Sheet should be adjusted for any sale or purchases during the year and the depreciation

(4) If new assets have been purchased, this would be reflected by the payments side of the Receipt and Payment account. The payments side of this account should, therefore be scanned and the assets shown to be purchased therein would appear on the assets side of the final Balance Sheet.

(5) If a loan has been raised, it is reflected by the receipts side of the Receipt and Payment account and the amount thereof (less any-repayment, as may be reflected by the payment side) would appear on the liability side of the Balance Sheet.

(6) If a loan has been advanced to any person, the same would be reflected by the payment side and recoveries (if any) by the receipts side of the Receipt and Payment account. Only the net amount would be shown-on the assets side of the Balance Sheet.

(7) Adjustments made in respect of expenses while preparing the income and expenditure account, viz., outstanding expenses and prepaid expenses would appear on the liabilities and assets sides of the Balance Sheet respectively.

(8) Adjustments for incomes would likewise be shown in the Balance Sheet, viz., income accrued but received on the assets side, and income received but not accrued on the liabilities side.

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