In Not-for-Profit Organisation, Donations received for specific purpose are shown on:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Liabilities side of Balance Sheet
A donation received for a specific purpose (a building, a book bank and so on) must be used only for that purpose. It is capitalised and shown as a fund on the liabilities side of the Balance Sheet, however small the amount.
Option (2) Income side of Income and Expenditure Account — Incorrect. Only general donations are revenue income.
Option (3) Payment side of Receipt and Payment Account — Incorrect. A donation received is a receipt, not a payment.
Option (4) Assets side of Balance Sheet — Incorrect. The fund is owed to the specified purpose; it is not an asset.
Note: This question is from the pre-rationalised NCERT book. The topic is not there in the latest NCERT book (2026-27), but it is still in the CUET 2026 syllabus, so do not skip it.
NCERT (Pre-rationalised edition): |