Accountancy Part AAccounts for Non Profit Organsiation

If the total income earned by Saket Club, a Not-for-Profit organizati…

If the total income earned by Saket Club, a Not-for-Profit organization is ₹2,60,000 and the surplus earned is ₹85,000, then the total expenditure incurred will be:

Answer & explanation

Correct answer: option 2

The correct answer is Option (2) → ₹1,75,000

The balance of the Income and Expenditure Account is a surplus when income is more than expenditure.

Surplus = Total income − Total expenditure
₹85,000 = ₹2,60,000 − Total expenditure
Total expenditure = ₹2,60,000 − ₹85,000 = ₹1,75,000

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):
Income and Expenditure Account – “It is the summary of income and expenditure for the accounting year. It is just like a profit and loss account prepared on accrual basis in case of the business organisations. It includes only revenue items and the balance at the end represents surplus or deficit.”