Practicing Success
Practicing Success
CUET Preparation Today
State the accounting treatment of Endowment Fund in financial statement of a public hospital. |
Debited to Income and Expenditure A/c Credited to Income and Expenditure A/c Shown on Liabilities side of Balance sheet Shown on Assets side of Balance sheet |
Shown on Liabilities side of Balance sheet |
The correct answer is Option (3) → Shown on Liabilities side of Balance sheet Endowment Fund: It is a fund arising from a bequest or gift, the income of which is devoted for a specific purpose. Hence, it is a capital receipt and shown on the Liabilities side of the Balance Sheet as an item of a specific purpose fund. |
