diffrence between income and expenditure account and profit and loss account - Accountancy - Accounting for Not-for-Profit Organisation

Question

diffrence between income and expenditure account and profit and
loss account

Komal Verma · Accepted Answer

The difference between Income and Expenditure Account and Profit
and Loss Account is given below

Basis

Income and Expenditure Account

Profit and Loss Account

Organisation

Prepared by Non-Profit Organisations whose main aim is not to earn
profits

Prepared by Profit-Earning Organisations whose main aim is to earn
profits

Basis

Prepared on the basis of Receipts and Payments Account with
additional information

Prepared on the basis of Trial Balance with additional
information

Motive

Primary motive to find out excess of income over expenditure or
excess of expenditure over income

Primary motive to find out net profit or net loss during the
year

Result

Reveals surplus or deficit

Reveals net profit or net loss

Basis	Income and Expenditure Account	Profit and Loss Account
Organisation	Prepared by Non-Profit Organisations whose main aim is not to earn profits.	Prepared by Profit-Earning Organisations whose main aim is to earn profits.

Basis	Prepared on the basis of Receipts and Payments Account with additional information.	Prepared on the basis of Trial Balance with additional information.

Motive	Primary motive to find out excess of income over expenditure or excess of expenditure over income.	Primary motive to find out net profit or net loss during the year.

Result	Reveals surplus or deficit.	Reveals net profit or net loss.