Class 12 Accountancy - ODISHA
Accounting for Not-for-Profit Organisations
The chapter Accounting for Not-for-Profit Organisations introduces Class 12 students to the financial record-keeping of entities established for charitable, educational, or religious purposes rather than earning profits. Students will learn how these organizations maintain books of accounts, which include the Receipt and Payment Account, Income and Expenditure Account, and Balance Sheet. Understanding this chapter is crucial for Odisha (BSE) board exams as it tests both theoretical knowledge of non-trading concerns and practical problem-solving skills in preparing final accounts from given receipts and payments data, typically carrying substantial weight in the annual examination.
Start Learning FreeKey Concepts
Not-for-Profit Organisation (NPO)
An entity whose primary objective is service rather than profit, such as schools, hospitals, and clubs.
Receipt and Payment Account
A summary of cash and bank transactions categorized under broad heads, serving as a classified summary of the Cash Book.
Income and Expenditure Account
A nominal account prepared on an accrual basis to show the surplus or deficit of an NPO for the accounting period.
Subscription
A periodic contribution made by members to keep their membership alive, treated as revenue income for the NPO.
Fund-Based Accounting
A method of accounting where specific funds (like a tournament fund) are maintained separately, and related incomes and expenses are adjusted against that fund.
Important Formulas
Board Exam Info
In the Odisha (BSE) Class 12 Accountancy board exams, this chapter generally carries around 10 to 15 marks. Common question types include short answer theory questions on the features of NPOs or differences between Receipt & Payment and Income & Expenditure accounts, alongside full-length practical problems requiring the preparation of an Income and Expenditure Account and Balance Sheet from a given Receipt and Payment Account.
Frequently Asked Questions
Is the Receipt and Payment Account the same as the Profit and Loss Account?
How is a legacy treated in the accounts of an NPO?
Do Not-for-Profit Organisations prepare a Trial Balance?
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