Tiiaiicidi pOSTtOTI Ol dil eTITy

particular date.
particulardate.
What is State ment of affairs?
Ans. A statement of affairs is a summary of all the assets and
liabilities of the business
balance in capital account on a particulardate. concern in order to estimate u

5. What is the necessity of preparing Statement of Affairs?

The statement of affairs is prepared in order to ascertain the
capital of the business. It could be either the opeening
capital or the closingcapital.
 7.What is Adjusted Closing Capital?
Ans. The difference between the additional capital and the sum
of closing capital, drawings is referred to as adjusted
closing capital.
Adjusted Closing Capital =
[Closing Capital Drawings (-) Additional Capital]
 Accounts from
Incomplete Records 11.5

DIfference between Statement of Affalrs and Balance Sheet

Statement of Affairs Balance Sheet

To ascertain Capital To ascertain financial

position
Prepared from Incomplete Prepared from
records double-entry System
Shows only estimated
financlal position Shows true financial position
Omission of transactions
Omission of transactions
cannot be traced easily
canbetraced easily

Format of Varlous Accounts in Incomplete Records

Debit the Decrease

a. Total Creditors Account Liability
Credit the Increase
Dr. Total Creditors Account Cr.
Particulars Particulars
To Bank A/c XXX | By Balance b/d XXX
[Cheques given] [Opening balance]
To Cash A/c XXX By Bank A/c XXX
[Cash paid] ICheques dishonored]
To Bills Payable A/c XXX By Bills Payable A/c XXX
[Bills accepted] Bills dishonored]
To Discount received XXX By Credit purchases
| XXX
| To Purchases returns
To Balance c/d
XXXXXX LLnlaning all
[Closing balance]
Total XXX Total XXX
1.6 Score More Series: I PUC
Accountancy

Debit the Increase

b. Total Debtors Account Asset
Credit the Decrease

Dr.
Total Debtors Account Cr.

Particularss Particulars

To Balance b/d XXX By Bank A/c XXX

[Opening balance] Cheques received]

To Bills receivable A/c XXX By Cash A/c XXX

[Bills dishonored] [Cash received]

To Bank Ac XXX By Bills Receivables A/c XXX

Cheques bounced dishonored] [Bills received]

To Credit Sales XXX By Discount allowed A/c XXX
By Sales returns A/c XXX

By Bad Debts XXX

By Balance c/d XXX

Total XXX Total XXX

Debit the Increase

c. Bills Receivable Account Asset
Credit the Decrease
Dr. Bills Receivable Account Cr.
Particulars Particulars
To Balance b/d XXX By Bank XXX
Opening balance] (Bills honored]
To Sundry Debtors XXX By Sundry Debtors XXX
[Bills received] Bills dishonored]
By Balance c/d XXX

Total
[Closing balance]
XXX Total XXX

Debit the Decrease

d Bills Payable Account
Liability-
Credit the Increase
Dr. Bills Payable Account Cr.
Particulars Particulars
To Bank XXX By Balance b/d XXX
Bills matured Opening balance]
To Sundry Creditors XXX By Sundry Creditors XXX
Bills dishonored Bills accepted]
ToBalance c/d XXX
Closing bhalance
Total XXX Total XXX