Non Profit Organization (NPO)

NPO 

Non Profit seeking organization is one type of charitable trust where group of people comes together to incorporate trust or organisation for welfare of the society.

In NPO we have to create 3 accounts:

1. Receipt and Payment Account

2. Income and Expenditure

3. Balance Sheet

Receipt and Payment Account:

Receipt and Payment Account is like a cash book where we record all cash receipts and all payments made during the financial year in one accounting year.

Income and Expenditure Account

Income and Expenditure Account is an account where we record from receipts and payments account where all expenses record on debit side of income and expenditure account and all income record on the credit side of income and expenditure account.

Balance Sheet

Balance Sheet is a statement where two sides are given Liabilities side and Assets side. Balance Sheet helps us to know the financial position of the business.

Subscription :

It is the amount paid by the members for their membership fees it is paid periodically in accounting year.

Calculation regarding Subscription

Subscription.                                 *****

Add: Outstanding for                  *****

  Current year

Less: Outstanding for the.                ******

  Previous year

Add: Prepaid Advance received    For previous year in current year *****

Less: Prepaid Advance for next  yearReceived in current year.           *****                                                               ____________

                                                                      ******

                                                            ___________