Which of these is NOT shown in the receipts and payments account?
APurchase of a building for cash
BSubscription received in advance
CDepreciation on the club's building
DCash paid for the year's salaries
Answer & Solution
Correct answer: C. Depreciation on the club's building
1. The receipts and payments account is a summary of actual cash and bank movements.
2. The textbook states that non-cash items such as depreciation, outstanding expenses and accrued income are not shown in it.
3. Depreciation involves no cash movement at all, so it is excluded.
4. A building bought for cash, salaries paid, and a subscription actually received in advance all involve cash, so all three are recorded.
5. Depreciation does appear in the income and expenditure account, which is prepared on the accrual basis.
_Source: TN HSC Class 12 Accountancy (Samacheer Kalvi, Govt of Tamil Nadu), Unit 2 "Accounts of Not-for-Profit Organisation", §2.3 and §2.5_
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