‘Is it possible to prepare the profit and loss account and the balance sheetfrom the incomplete book of accounts kept by a trader’? Do you agree? Explain.

Q: Who are the users of financial statements? Why do they need financial statement?

A: Financial statements are those which are prepared by the entity at the end of the period. These…

Q: . How are the balance sheet and the income statement related to one another? How would youexplain to…

A: The balance sheet and income statement are related to one another by double entry system. Each entry…

Q: How does a balance sheet get completed? What accounts show on the balance sheet? Is there a…

A: Balance Sheet: A balance sheet is a statement of financial position of the business at a particular…

Q: what are the importance of tral balance in accounting?

A: Trial balance is a statement of all the general ledger account balances at a specific point in time,…

Q: orting  2. What are characteristics  that  make financial statements useful to its users ? 3. What…

A: 1.Financial statements are prepared based on thefollowing underlying assumptions:Economic entity…

Q: How does the double-entry accounting system ensure the accuracy of financial transactions and…

A: The double entry system of accounting or bookkeeping means that for each and every business…

Q: In respect to financial accounts, what do you understand by "materiality?" Also, name two variables…

A: Here is the Answer :

Q: Please answer with reason for all why the option is correct and why the other options are…

A: Realisation Concept: Realisation concept assumes that revenue is recognized only when there is a…

Q: What is the difference between a debit and a credit in accounting? How do these concepts relate to…

A: The relationship between a firm's profits, liabilities, and equity is represented by the accounting…

Q: How does the integration of blockchain technology impact the fundamental principles of double-entry…

A: The "Conceptual Framework for Financial Reporting" serves as a fundamental guide for accounting…

Q: A credit of a debt account can in the case of the counter-accounting (debiting) involve a booking of…

A: Debt refers to the amount that is due to be paid to the outsiders. The debt can be recorded as…

Q: What information is provided in a Balance Sheet and how and to whom can be useful

A: A balance sheet is a statement of assets, liability, and equity.It is prepared after the income…

Q: What is the purpose of preparing trading and profit and loss account?

A: Trading Account The majority of the trading account is made up of credit and debit. Direct expenses…

Q: The following statement describes an accounting concept. In conditions of uncertainty more…

A: Accounting Concept -A collection of broad rules known as accounting principles can be applied as…

Q: Why are the income statement accounts closed but thebalance sheet accounts are not?

A: Income Statement accounts are closed but the Balance Sheet are not closed.

Q: What is accrual accounting and why is it the preferred method for most organisations?

A: The following are two methods used for financial reporting as follows under:-.Cash accountingAccrual…

Q: Explain the concept of double-entry accounting, and discuss its importance in maintaining accurate…

A: Double-entry accounting is a system of bookkeeping in which every financial transaction is recorded…

Q: The account used to keep track of earnings and losses?

A: The summary of income, expenditures, and spending for a certain time period are listed in the…

Q: Give an example of how this chosen principle affect the financial reporting process. You can explain…

A: The principle of consistency suggests that you need to adhere to and follow this principle…

Q: What effect does recording a sale have on a balance sheet?

A: Balance sheet: It shows the assets, liabilities, and stockholder's equity of the organization. Sale…

Q: what are accounting principles?

A: Accounting principles are a set of rules and regulations that should be followed when reporting the…

Q: A knowledgeable investor tries to asses -earnings quality -accounts receivable a -accounts payable…

A: Investor is the person who invests in some property or asset.

Q: 1. What is the earnings management? How to apply it to the accounting? 2. What is the ethical…

A: 1. What is Earnings Management? How to Apply It to Accounting?Earnings management refers to the use…

Q: TRUE OR FALSE? The debit balances in suppliers' accounts should be netted against accounts payable.

A: Accounts payable is the amount owed by the business entity towards the suppliers in respect of the…

Q: Define accounting? Also elaborate the rules for debit and credit in detail.

A: Accounting - It is the recording of financial events along with other functions of storing, sorting,…

Q: To what end does financial accounting serve?

A: The end of financial accounting is to provide business with the financial performance and financial…

Q: How can you ensure that your accounting records are accurate?

A:

Q: What does it mean to recognize an accountingtransaction?

A: The accounting transactions that directly or indirectly alters the financial aspect of the…

Q: adjusting some transactions before Final Accounts are prepared?

A: The final accounts are prepared after making adjustments. Adjustments are very much required for the…

Q: The form of asymmetric information that exists before a financial transaction is in place is while…

A: Adverse selection is an asymmetric information problem that occurs prior to a financial transaction…

Q: Discuss, using practical example how to the presence of double entry principles affect the…

A: Double entry principle says that for recording of every transaction in business, at least one…

Q: Is it still necessary to record a transaction if it has no net effect on the accounting equation?…

A: Accounting equation says that total assets in the business must always be equal to total liabilities…

Financial Transaction Analysis

The transaction analysis is done with the help of the accounting equation. The basic accounting equation is alternatively known as the balance sheet equation is based on the double-entry system which says that for each transaction happening in a business, at least two accounts should be affected I.e. both the debit side and the credit side should be equal. The Accounting Equation is