Income and Expenditure Account represents either surplus or deficit.

Question

State whether the following statements are True or False with reasons.

Income and Expenditure Account represents either surplus or deficit.

Answer 1

This statement is True.

In the Income and Expenditure Account, all revenue incomes and expenses are recorded and at the end of the specified period, the difference is found out which is known as ‘Surplus’ (Revenue incomes are more than Revenue expenses) or ‘Deficit’ (Revenue expenses are more than Revenue incomes).