Final Account
1. What is final account?
Ans: Final account is accounts which are prepared to see the operating results and financial position of an organization.
2. What is trading account?
Ans: Trading account is an account which is prepared to calculate Gross profit or Gross Loss.
3. What is profit and loss account?
Ans: P/L account is an account which is prepared to find out the amount of net profit or net loss.
4. What is balance sheet?
Ans: Balance sheet is a statement which is prepared incorporating capital and liabilities in left hand side and assets in right hand side to see the financial position of an organization.
5. How do you calculate gross profit?
Ans: The gross profit is calculated comparing amount of sales and closing stock over the direct expenses and factory expenses.
6. How is net profit determined?
Ans: The net profit is calculated adding all indirect incomes in gross profit and deducting office expenses, selling and distribution expenses and all sort of loss.
7. Which statement do you prepare to see the financial position of an organization?
Ans: Balance Sheet is prepared to see the financial position of an organization.
8. What is capital?
Ans: Amount of money in terms of cash or kind invested by the owner in the business is known as capital.
9. Why is capital treated as liability?
Ans: Capital is treated as liability in Balance sheet because it is to be refunded after the dissolution of the company to the owners.
10. Why is Reserve treated as liability?
Ans: Reserve is treated as liability in Balance Sheet because it is part of profit. Profit is liability so it is treated as liability.
11. Do you take goodwill as an asset?
Ans: yes we can take goodwill as an assets because it helps to increase the income and can be sold along with the business or name of the business.
12. When is balance sheet prepared?
Ans: Balance Sheet is prepared at the end of accounting year or fiscal year.
13. Why is profit and loss account prepared?
Ans: Profit and loss account is prepared because of the following reasons.
- To find net profit or net loss.
- To help in the preparation of balance sheet.
14. How is the net profit and net loss adjusted in balance sheet?
Ans: If the net profi is given we should added to the amount of capital and if the net loss is given we should be deducted from the amount of capital in Balance Sheet.
15. Write four examples of intangible assets.
Ans: Four examples of intangible asstes are listed below.
- Goodwill
- Copyright
- Patent right
- Trade mark
16. In which part of balance sheet does bank over draft recorded?
Ans: Bank over draft is recorded in capital and liabilities sides of balance sheet.
Ans: Final account is accounts which are prepared to see the operating results and financial position of an organization.
2. What is trading account?
Ans: Trading account is an account which is prepared to calculate Gross profit or Gross Loss.
3. What is profit and loss account?
Ans: P/L account is an account which is prepared to find out the amount of net profit or net loss.
4. What is balance sheet?
Ans: Balance sheet is a statement which is prepared incorporating capital and liabilities in left hand side and assets in right hand side to see the financial position of an organization.
5. How do you calculate gross profit?
Ans: The gross profit is calculated comparing amount of sales and closing stock over the direct expenses and factory expenses.
6. How is net profit determined?
Ans: The net profit is calculated adding all indirect incomes in gross profit and deducting office expenses, selling and distribution expenses and all sort of loss.
7. Which statement do you prepare to see the financial position of an organization?
Ans: Balance Sheet is prepared to see the financial position of an organization.
8. What is capital?
Ans: Amount of money in terms of cash or kind invested by the owner in the business is known as capital.
9. Why is capital treated as liability?
Ans: Capital is treated as liability in Balance sheet because it is to be refunded after the dissolution of the company to the owners.
10. Why is Reserve treated as liability?
Ans: Reserve is treated as liability in Balance Sheet because it is part of profit. Profit is liability so it is treated as liability.
11. Do you take goodwill as an asset?
Ans: yes we can take goodwill as an assets because it helps to increase the income and can be sold along with the business or name of the business.
12. When is balance sheet prepared?
Ans: Balance Sheet is prepared at the end of accounting year or fiscal year.
13. Why is profit and loss account prepared?
Ans: Profit and loss account is prepared because of the following reasons.
- To find net profit or net loss.
- To help in the preparation of balance sheet.
14. How is the net profit and net loss adjusted in balance sheet?
Ans: If the net profi is given we should added to the amount of capital and if the net loss is given we should be deducted from the amount of capital in Balance Sheet.
15. Write four examples of intangible assets.
Ans: Four examples of intangible asstes are listed below.
- Goodwill
- Copyright
- Patent right
- Trade mark
16. In which part of balance sheet does bank over draft recorded?
Ans: Bank over draft is recorded in capital and liabilities sides of balance sheet.
