12th Accountancy - Book Back Answers - Unit 2 - English Medium Guides ~ Kalvi Tips

12th - Accountancy - Book Back Answers - Unit 2 - English Medium

Tamil Nadu Board 12th Standard Accountancy - Unit 2: Book Back Answers and Solutions

This post covers the book back answers and solutions for Unit 2 – from the Tamil Nadu State Board 12th Standard Accountancy textbook. These detailed answers have been carefully prepared by our expert teachers at KalviTips.com.

We have explained each answer in a simple, easy-to-understand format, highlighting important points step by step under the relevant subtopics. Students are advised to read and memorize these subtopics thoroughly. Once you understand the main concepts, you’ll be able to connect other related points with real-life examples and confidently present them in your tests and exams.

By going through this material, you’ll gain a strong understanding of Unit 2 along with the corresponding book back questions and answers (PDF format).

Question Types Covered:

1 Mark Questions: Choose the correct answer,
2 Mark Questions: Very Short Answer Questions
3, 4, and 5 Mark Questions: Short Answer Questions, Excercises

All answers are presented in a clear and student-friendly manner, focusing on key points to help you score full marks.

All the best, Class 12th students! Prepare well and aim for top scores. Thank you!

Topic: Unit 2 :Accounts Of Not For Profit Organisation

I. Choose the correct Answer

Question 1.
Receipts and payments account is a …………….
(a) Nominal A/c
(b) Real A/c
(c) Personal A/c
(d) Representative personal account
Answer Key:
(b) Real A/c

Question 2.
Receipts and payments account records receipts and payments of …………….
(a) Revenue nature only
(b) Capital nature only
(c) Both revenue and capital nature
(d) None of the above
Answer Key:
(c) Both revenue and capital nature

Question 3.
Balance of receipts and payments account indicates the …………….
(a) Loss incurred during the period
(b) Excess of income over expenditure of the period
(c) Total cash payments during the period
(d) Cash and bank balance as on the date
Answer Key:
(d) Cash and bank balance as on the date

Question 4.
Income and expenditure account is a …………….
(a) Nominal A/c
(b) Real A/c
(c) Personal A/c
(d) Representative personal account
Answer Key:
(a) Nominal A/c

Question 5.
Income and Expenditure Account is prepared to find out …………….
(a) Profit or loss
(b) Cash and bank balance
(c) Surplus or deficit
(d) Financial position
Answer Key:
(c) Surplus or deficit

Question 6.
Which of the following should not be recorded in the income and expenditure account?
(a) Sale of old news papers
(b) Loss on sale of asset
(c) Honorarium paid to the secretary
(d) Sale proceeds of furniture
Answer Key:
(d) Sale proceeds of furniture

Question 7.
Subscription due but not received for the current year is …………….
(a) An asset
(b) A liability
(c) An expense
(d) An item to be ignored
Answer Key:
(a) An asset

Question 8.
Legacy is a …………….
(a) Revenue expenditure
(b) Capital expenditure
(c) Revenue receipt
(d) Capital receipt
Answer Key::
(d) Capital receipt

Question 9.
Donations received for a specific purpose is …………….
(a) Revenue receipt
(b) Capital receipt
(c) Revenue expenditure
(d) Capital expenditure
Answer Key:
(b) Capital receipt

Question 10.
There are 500 members in a club each paying RS 100 as annual subscription. Subscription due but not received for the current year is RS 200; Subscription received in advance is ? 300. Find out the amount of subscription to be shown in the income and expenditure account,
(a) RS 50, 000
(b) RS 50, 200
(c) RS 49, 900
(d) RS 49, 800
Answer Key:
(a) RS 50,000

II.Very short answer questions

1. State the meaning of not–for–profit organisation.

Some organisations are established for the purpose of rendering services to the public without any profit motive. These organisations are called not–for–profit organisation.
Ex- sports clubs, hospitals, libraries

2. What is receipts and payments account?

Receipts and Payments account is a summary of cash and bank transactions of not–for– profit organisations prepared at the end of each financial year. It is a real account in nature.

3. What is legacy?

A gift made to a not–for–profit organisation by a will, is called legacy. It is a capital receipt.

4. Write a short note on life membership fees.

Amount received towards life membership fee from members is a capital receipt as it is non-recurring in nature.

5. Give four examples for capital receipts of not–for–profit organisation.

i)Life membership fees

ii) Legacies

iii) Sale of fixed assets

iv) Prize fund

6. Give four examples for revenue receipts of not–for–profit organisation.

i) Subscription

ii) Sale of (old) sports materials

iii) Sale of (old) newspapers

iv)Interest on investment

III. Short answer questions

1. What is income and expenditure account?

Income and expenditure account is a summary of income and expenditure of a not–for– profit organisation prepared at the end of an accounting year. It is prepared to find out the surplus or deficit pertaining to a particular year. It is a nominal account.

2. State the differences between Receipts and Payments Account and Income and Expenditure Account.

Basis	Receipts and payments	Income and expenditure
1. Purpose	It is prepared to know the cash receipts and cash payments.	It is prepared to know the surplus and deficit during the current period.
2. Nature of account	It is a real account	It is a nominal account
3. Basis of accounting	It is based on cash system of accounting. Non-cash items are not recorded.	It is based on accrual system of accounting. Non-cash items are recorded

3. How annual subscription is dealt with in the final accounts of not–for–profit organisation?

Dr Income and Expenditure Account for the year ended… Cr

Expenditure	Rs	Income	Rs	Rs
		By subscription Less: subscription for the previous year	xxx xxx
		Less: subscription for the subsequent year	xxx xxx
			xxx
		Add: Outstanding subscription for the current year	xxx
			xxx
		Add: Received in advance during the previous year for the current year	xxx	xxx
				xxx

4. How the following items are dealt with in the final accounts of not–for–profit organisation?

a) Sale of sports materials

Consumable items such as sports materials, stationery, medicines, etc., consumed during the year will appear on the debit side of income and expenditure account.
Closing stock will appear on the assets side of the balance sheet as at the end of the year.

b) Life membership fees

Amount received towards life membership fee from members is a capital receipt as it is non- recurring in nature.

c) Tournament fund

It is recurring in nature. (ii) It is revenue receipt. (iii) It is shown liabilities side of balance sheet.