T Y B Com Single Entry

Single Entry

Two Methods of Ascertainment of

Profit or Loss under Single Entry system 1. Statement of Affairs Method 2. Conversion Method

Procedure for ascertaining the Profit or Loss under Statement of Affairs Method 1. 2.

3. 4.

Prepare Statement of Affairs in the beginning of the year to find out Opening Capital. Prepare Statement of Affairs at the close of the year without considering adjustments, if any to find out the Closing Capital. Prepare Statement of Profit & Loss to find out the Profit or Loss made during the year. Prepare Revised Statement of Affairs after giving effect to the adjustments.

Usual Format of Statement of Affairs (Opening & Closing) Liabilities Creditors Bills Payable Outstanding Exp Bank Overdraft Capital (Balancing Figure)

xxx xxx xxx xxx xxx

Assets Cash in Hand xxx Cash at Bank xxx S. Debtors xxx Closing Stock xxx Bill Receivable xxx Fixed Assets xxx Prepared Expenses xxx

Preparation of Statement showing Profit or Loss Closing Capital Add: Drawing Add: Interest on Drawing Less: Fresh Capital Introduced Less: Capital in the beginning of the Year Gross Profit Add: other income like Interest & Discount etc Less: Depreciation xxx Bad Debts xxx Expenses xxx Net Profit or Loss during the year

xxx xxx xxx xxx xxx xxx xxx xxx xxx

xxx xxx

Format of Revised Statement of Affairs Liabilities Opening Capital Add: Fresh Capital Add: Int on Capital Add: Net Profit Less Drawing

Creditors Bills Payable Outstanding Exp. Bank Overdraft

Assets Cash in Hand Cash at Bank S. Debtors Less: R.D.D. Closing Stock Bill Receivable Fixed Assets Prepared Expenses

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