Question

Distinguish between : "Receipts and Payment Account" and "Income and Expenditure Account".

Answer 1

Difference between Receipt and Payment Account and Income and Expenditure Account

Bases of Difference	Receipt and Payment Account	Income and Expenditure Account
1. Form	It is a summary of cash book.	It is a summary of profit and loss account.
3. Sides	Its left hand side is receipts and right hand side is payment	The left hand side is expenditure and the right hand side is income.
4: Balance	It starts with opening balance of cash and ends as showing closing balance of cash	It does not start with opening balance of cash and does not show closing balance of cash.
5. Capital and revenue items	It records receipts and payments of both capital and revenue nature	It records income and expenditure of revenue nature only
6. Amount	It records all the cash receipts and payments, whether relating to current year or previous year	It records all income and expenditure of the current year on accrual basis.