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JAMB Principles of Accounts 2003 Question 30

Question 30

Not-for-Profit Organisations

Income and expenditure account is more informative than receipts and payments account because it discloses

  1. A.cash
  2. B.cheques
  3. C.debtors
  4. D.stocks
Show the answer and explanation

Answer: C (debtors)

Explanation

Income and expenditure uses the accruals basis, so it takes in amounts owing (such as subscriptions in arrears), which a cash-only receipts and payments account ignores.