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WAEC Financial Accounting 2021 Question 31

Question 31

Not-for-Profit Organisations

Members of a not-for-profit making organization

  1. A.earn dividend on their contributions.
  2. B.do not receive surplus at the end of the year.
  3. C.are paid interest on their contributions.
  4. D.share profits according to their contributions.
Show the answer and explanation

Answer: B (do not receive surplus at the end of the year.)

Explanation

Surpluses stay in the club's accumulated fund; members are not paid dividends or profit shares.