By Balance b/d By Profit and loss adjus- ment A/c 10,600 Teg o 16,000 12,000 10,400 16,600 12,400 10,600 009 16,600 12,400 10,600 Balance Sheet of B and C (as at April 1, 2019) Amount Capital and Liabilities Assets and Properties Amount Creditors Bills Payable Dutstanding Expenses A's Loan A/c 7,900 Bank 1,500 Stock 800 Debtors 16,600 Machinery 1,600 11,200 Land and Buildings 8,800 Capitals: 18,600 12,400 B. 23,000 C. Part 49,800 49,800 Memorandum Revalution Account lustration 8 Om, Jay and Jagdish were partners in a firm. They share profit and loss in the ratio of 4 :4:2. Their Balance Sheet as at 31-3-2019 was as follows : Sundry Creditors Om's loan A/c 99,280 Building 30,000 Furniture Plant 000' 000'08 69,800 74,330 89,150 Capital Accounts : 80,000 Bank Sundry Debtors Jay Jagdish 000'89 000'8L 2,26,000 3,55,280 3,55,280 On 1st April, 2019 Om got his retirement. Building at ? 58,000; Furniture at 7 84,000; Plant at ? O00 were revalued. Total goodwill of the firm is 7 96,000. Om accepted the furniture at its revalued balan part payment of his dues. Jay brought in 7 40,000 as additional capital and Om was paid off the Solutt of his account. Prepare Memorandum Revalution A/c and the Balance Sheet. Memorandum Revalution A/c Date Particulars qunouy Date Particulars Amount 2019 2019 16,000 By Building A/c By Furniture A/c Apr.1 To Plant A/c 4,200 Apr. 1 000 To Profit transferred to : Om's capital A/c 6,320
Reporting Cash Flows
Reporting of cash flows means a statement of cash flow which is a financial statement. A cash flow statement is prepared by gathering all the data regarding inflows and outflows of a company. The cash flow statement includes cash inflows and outflows from various activities such as operating, financing, and investment. Reporting this statement is important because it is the main financial statement of the company.
Balance Sheet
A balance sheet is an integral part of the set of financial statements of an organization that reports the assets, liabilities, equity (shareholding) capital, other short and long-term debts, along with other related items. A balance sheet is one of the most critical measures of the financial performance and position of the company, and as the name suggests, the statement must balance the assets against the liabilities and equity. The assets are what the company owns, and the liabilities represent what the company owes. Equity represents the amount invested in the business, either by the promoters of the company or by external shareholders. The total assets must match total liabilities plus equity.
Financial Statements
Financial statements are written records of an organization which provide a true and real picture of business activities. It shows the financial position and the operating performance of the company. It is prepared at the end of every financial cycle. It includes three main components that are balance sheet, income statement and cash flow statement.
Owner's Capital
Before we begin to understand what Owner’s capital is and what Equity financing is to an organization, it is important to understand some basic accounting terminologies. A double-entry bookkeeping system Normal account balances are those which are expected to have either a debit balance or a credit balance, depending on the nature of the account. An asset account will have a debit balance as normal balance because an asset is a debit account. Similarly, a liability account will have the normal balance as a credit balance because it is amount owed, representing a credit account. Equity is also said to have a credit balance as its normal balance. However, sometimes the normal balances may be reversed, often due to incorrect journal or posting entries or other accounting/ clerical errors.
The retirement of a partner indicates that the partner leaves the partnership with the consent of all remaining partners. During the retirement procedure, the retiring partner's due amount is computed and added to his or her partner's capital account to determine his or her final capital.
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