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WAEC Financial Accounting 2012 Question 27

Question 27

Not-for-Profit Organisations

The equivalent of Income and Expenditure Account in a trading concern is

  1. A.Trading Account.
  2. B.Profit and Loss Account.
  3. C.Appropriation Account.
  4. D.Balance Sheet.
Show the answer and explanation

Answer: B (Profit and Loss Account.)

Explanation

Both compare income with expenses for the period to find a surplus or deficit; in a trading business that statement is the Profit and Loss Account.