The net profit from a trading account of a non-profit making organization would be treated as income in the

The net profit from a trading account of a non-profit making organization would be treated as income in the

Answer Details

The net profit from a trading account of a non-profit making organization would be treated as income in the income and expenditure account. The income and expenditure account is a financial statement that shows the income earned and expenses incurred by a non-profit organization during a particular accounting period, usually one year. This statement is similar to the profit and loss account used by for-profit organizations. When a non-profit organization earns income from trading activities, such as selling goods or services, any resulting net profit would be treated as income in the income and expenditure account. This is because the purpose of a non-profit organization is not to make a profit for its owners or shareholders, but to achieve its charitable or social objectives. The income and expenditure account shows the surplus or deficit of the organization for the accounting period, and it is used to determine whether the organization has achieved its charitable or social objectives within its financial means. Any surplus can be used to fund future activities or to strengthen the organization's financial position. Therefore, the correct answer is income and expenditure account.