Balance Sheet from Receipt and Payment
Balance sheet of a non profit organisation can easily made from receipt and payment account because all most all the transactions of non profit organisation are in the form of cash. So, if we have previous year balance sheet and current year receipt and payment account, we can easily prepare balance sheet. Now I am explaining its steps:
1st Step: Get the Raw Data.
First of you have to keep previous year balance sheet and current year receipt and payment account near to you. Both will be helpful for preparing balance sheet. In balance sheet, we show all the capital items which have been shown in the receipt and payment account and also bring previous year assets and liabilities.
2nd Step: Show the Asset and Liabilities from Receipt and Payment Account
Now, we have explaining, how you can convert the payments of receipt and payment account into the assets of Balance sheet.
a) Credit side of receipt and payment account will be payment side. In this side, you have to take capital nature expenses and closing balance. All other revenue expenses payments should leave. Add new bought asset in the particular asset’ s opening balance which we can take from previous year balance sheet. If any fixed asset has been sold, deduct it in same fixed asset. After this, deduct the depreciation.
Now, deduct the depreciation and show it in the fixed asset side. For example we are taking one fixed asset Furniture opening balance xxxx
Add new bought xxxx------------------------------------- Total furniture xxxx
Less sale of scrap furniture xxxx.--------------------------------------