Question on: JAMB Accounting - 2022

The excess of income over expenditure represents profit (in a business) or surplus (in a non-profit organization). This surplus increases the owner's equity or the organization's net assets.

• Accumulated fund: This is the account where the surplus is transferred to increase the net assets of a non-profit organization.
• Profit and loss account: This is the account used to calculate profit or loss; the balance is then transferred elsewhere.
• Current assets/liabilities in the balance sheet: These represent short-term assets and obligations, not the long-term result of operations.