Which of the following is false for Not-for-profit organisation?

The correct answer is Option (1) → Scholarships granted to students out of funds provided by government will be credited to Income and Expenditure Account

Scholarships paid out of a fund given by the government for that purpose are deducted from that specific fund on the liabilities side of the Balance Sheet; they do not pass through the Income and Expenditure Account at all. With “debited”, this statement is false. With “credited”, as in this option, the statement is false too, because such scholarships go to the specific fund.

Option (2) Receipt and Payment Account does not differentiate between Capital and Revenue receipts — A true statement. It records every receipt and payment in cash, capital or revenue alike.

Option (3) Opening Balance sheet is prepared when the opening Balance of Capital fund is not given — A true statement. The opening Balance Sheet is drawn up to find the opening capital fund as the balancing figure.

Option (4) The balancing figure on credit side of Income and Expenditure denotes excess of expenses over incomes — A true statement. A credit balancing figure means expenditure was more than income, that is, a deficit.

Note: This question is from the pre-rationalised NCERT book. The topic is not there in the latest NCERT book (2026-27), and it is also out of the CUET 2026 syllabus.