Final Accounts
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FINAL ACCOUNTS BY- JASMINE KAUR A19 MBA 1ST 337(B)
INTRODUCTION
Final accounts is the concise picture of profitability and financial position of business for conveying to the management, owners, and interested outsiders. Its not the first step of accounting process but is the end product of accounting process which give a concise information of accounting period after accounting period is over.
These accounts summarizes all the accounting information recorded in the subsidiary books and ledger. Final accounts is also termed as “FINANCIAL STATEMENTS”.
DEFINITION AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS: “Financial statements are prepared for purpose of presenting a periodical review or report on the progress by management and deal with-status of investments in business -results achieved during the period under review.
2 BASIC NEEDS
TO ACERTAIN THE PROFIT OR LOSS OF BUSINESS FOR AN ACCOUNTING PERIOD…. TO ACERTAIN THE FINANCIAL POSITION OF BUSINESS AT END OF THE FINANCIAL PERIOD…..
PRINCIPLES IN ACCUMULATION OF ACCOUNTING DATA
A distinction should be made between capital and revenue, both income and expenditure. Income and expenses relating to a period of account should be separated from those of another period. The record of transactions should be maintained continuously at end of each accounting period.
Every information, considered material for judging the profitability of the business or its financial position, should be disclosed.
Purpose of preparation of final accounts Trading concern Manufacturing concern
TRADING CONCERN
Trading concerns are those which purchase the finished goods from market and sell it at a profit. For this firms prepare: _ trading account _ profit and loss account _balance sheet
MANUFACTURING CONCERN
The manufacturing concerns are those which purchase raw materials and effect certain productive activities on it and convert the same into marketable finished goods and then sell it. Such concerns prepare: _ manufacturing account _ trading account _ profit and loss account _ balance sheet
THANK YOU
INTRODUCTION
Final accounts is the concise picture of profitability and financial position of business for conveying to the management, owners, and interested outsiders. Its not the first step of accounting process but is the end product of accounting process which give a concise information of accounting period after accounting period is over.
These accounts summarizes all the accounting information recorded in the subsidiary books and ledger. Final accounts is also termed as “FINANCIAL STATEMENTS”.
DEFINITION AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS: “Financial statements are prepared for purpose of presenting a periodical review or report on the progress by management and deal with-status of investments in business -results achieved during the period under review.
2 BASIC NEEDS
TO ACERTAIN THE PROFIT OR LOSS OF BUSINESS FOR AN ACCOUNTING PERIOD…. TO ACERTAIN THE FINANCIAL POSITION OF BUSINESS AT END OF THE FINANCIAL PERIOD…..
PRINCIPLES IN ACCUMULATION OF ACCOUNTING DATA
A distinction should be made between capital and revenue, both income and expenditure. Income and expenses relating to a period of account should be separated from those of another period. The record of transactions should be maintained continuously at end of each accounting period.
Every information, considered material for judging the profitability of the business or its financial position, should be disclosed.
Purpose of preparation of final accounts Trading concern Manufacturing concern
TRADING CONCERN
Trading concerns are those which purchase the finished goods from market and sell it at a profit. For this firms prepare: _ trading account _ profit and loss account _balance sheet
MANUFACTURING CONCERN
The manufacturing concerns are those which purchase raw materials and effect certain productive activities on it and convert the same into marketable finished goods and then sell it. Such concerns prepare: _ manufacturing account _ trading account _ profit and loss account _ balance sheet
THANK YOU
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