Assertion (A): The Receipts and Payments Account reflects non-cash transactions such as depreciation. Reasoning (R): Depreciation is a non-cash expense that affects the organization’s financial position.

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KollegeApply · Accepted Answer

A is false but R is true. Explanation: The Assertion is false since the Receipts and Payments Account is only a cash summary and excludes all non-cash elements. However, the reasoning is true because depreciation is a non-cash expense that affects the value of fixed assets, thus impacting the organization’s net financial position on the balance sheet.

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