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प्रश्न
Distinguish between a Profit and Loss Account and a Balance Sheet.
उत्तर
| S. No. | Basis of Distinction | Profit and Loss Account | Balance Sheet |
| 1. | Purpose | It is prepared to ascertain the net profit or net loss. | It is prepared to know the financial position. |
| 2. | Period | It presents the results of business for a particular period, usually one year. | It is prepared at a particular date. |
| 3. | Nature | It is an account. | It is a statement. |
| 4. | Headings | Its two sides are called income and expenses. | Its two sides are called assets and liabilities. |
| 5. | Contents | It contains all the nominal accounts. | It contains all the real and personal accounts. |
| 6. | Difference | The difference in the totals of the two sides represents the net profit or net loss. | Its two sides are equal in total. |
| 7. | Effect on accounts | The accounts transferred to it are closed and no balance exists in these accounts. | The balances of accounts included in the balance sheet are brought forward in the next year. |
APPEARS IN
संबंधित प्रश्न
It is a financial statement which sets out the assets and liabilities of a trading or non-trading organisation as on a certain date.
______ is not an account but only a statement of assets and liabilities.
The excess of assets over liabilities represents the ______ of the owner.
It helps the investor to know the earning capacity and financial health of the firm.
Why is a Balance Sheet prepared?
The following trial balance was extracted from the books of A. Harding, as on 31st March, 2019:
| Debit (₹) | Credit (₹) | |
| Capital | 20,100 | |
| Drawings | 1,500 | |
| Cash in Hand and at bank | 1,400 | |
| Petty Cash | 100 | |
| Cash Purchases and Sales | 10,000 | 20,000 |
| Credit Purchases and Sales | 12,000 | 25,000 |
| Returns | 2,000 | 1,000 |
| Discount | 400 | |
| Carriage Inwards | 500 | |
| Salaries | 6,000 | |
| Sundry and Petty Expenses | 1,200 | |
| Opening Stock | 5,000 | |
| Bad Debts | 600 | |
| Rent | 1,500 | |
| Machinery | 36,000 | |
| Furniture | 5,000 | |
| Debtors and Creditors | 5,000 | 10,000 |
| Stationary | 2,500 | |
| Commission | 200 | |
| Bank Loan | 14,400 | |
| 90,700 | 90,700 |
Prepare the complete set of final accounts for Mr. A. Harding, after incorporating the following adjustment:
- Closing stock is ₹ 26,000.
It is a statement of assets and liabilities. It is prepared to judge the financial position on a particular date.
The main use(s) of a Balance Sheet for a non-trading organisation is/are ______.
It is always prepared on a particular date.
It is not an account but a statement.
______ shows the financial position of the organization.
Which of the following is not a feature of Balance Sheet?
State any two uses of Balance Sheet.
Balance sheet is an Account. Justify.
Write a short note on Role of Balance Sheet in decision making.
