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WAEC Financial Accounting 1992 Question 17

Question 17

Not-for-Profit Organisations

In a non-profit oriented organisation, the excess of income over expenditure is

  1. A.added to the capital
  2. B.added to the accumulated fund
  3. C.deducted from the capital
  4. D.deducted from the accumulated fund
  5. E.deducted from the reserve.
Show the answer and explanation

Answer: B (added to the accumulated fund)

Explanation

A club's surplus is added to its accumulated fund.