alleryLife Membership Fees are normally treated as:
ACapital receipt (fund)
BRevenue income always
CLiability written off
DDirect expense charge
Answer & Solution
Correct answer: A. Capital receipt (fund)
1. Life membership fees are one-time payments for lifetime membership.
2. They are treated as capital receipts and credited to a Life Membership Fund.
3. Some NPOs amortise this fund over an estimated life.
_Source: ICAI BoS Foundation Paper 1, Ch 8 "NPO", §3.1 ¶4_
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