Prepared by:Vaidehi Bhoir Roll no-20 MMS-1

. It shows the dual impact. As balance sheet is a report. Every business organisation prepare balance sheet to serve information to their shareholders. Statement of asset & liabilities of business at particular date. which or comparative study of assets & liability. Balance sheet is an essential part of an Annual Report or Final account. it has no debit & credit side.Meaning:Balance sheet is statement of financial position. investors etc.

Profit & loss appropriation account. Profit & loss account. Various Contain of final account:Trading account. Balance sheet .BALANCE SHEET An essential part of final account.

IN THE BOOK OF XYZ COMPANY LTD BALANCE SHEET AS ON 31TH DECEMBER 2010 Amt(Rs.) xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx Goodwill Patents Copy right Tangible goods Land & Building Plant & Machinery Loose tool Investment Furniture & fixture Current asset Cash in hand Cash at bank Asset Intangible goods Amt(Rs.) xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx liabilities a) Capital Authorised capital Equity share capital Preference share capital Reserve & surplus (+) Net profit (-) Net loss (-) Drawings b) Current liabilities Sundry creditors Bills payable Out standing expenses Bank overdraft .

Income received in advance c) Fixed non-current liabilities loans & advances contingent liabilities xxx xxx xxx Prepaid expenses Sundry debtors Bills receivable Closing stock Prepaid loan Accrued income Miscellaneous expenses xxx xxx xxx xxx xxx xxx xxx .

ADJUSTMENT ENTRIES:Adjustment (1) Outstanding expenses (2) Adjustment entry Expenses A/c -Dr Treatment in balance sheet Shown on the liabilities Side. To Trading A/c (4) Accrued income Accrued income -Dr To Income A/c Shown on the asset side. . To expenses A/c (3) Closing stock Closing stock -Dr Shown on the asset side. To O/s expenses A/c Prepaid expenses Prepaid expenses A/c -Dr Shown on the asset side.

Reserve for discount on Creditor A/c To P/L A/c -Dr Deduct from creditors on liabilities. . To provision for discount on debtor A/c (8) Reserve for discount on Creditor. (6) Provision for baddebts P/L A/c -Dr Shown on the liabilities Side. To provision for bad-debts A/c (7) Provision for discount P/L A/c -Dr Deduct from sundry Debtors on asset side.(5) Depreciation (a) Depreciation A/c -Dr To assets A/c (b) Depreciation A/c To provision A/c Deduct depreciation amt from assets on asset side.

fixed instalment method etc. Different organisation use different polices.LIMITATIONS OF BALANCE SHEET Day-to-day changes cannot be filled. Management makes balance sheet in the form of window-dressing to attract the attention of shareholders. it has to be show in adjustment. . It cannot determine exact position of an organisation.FIFO. investors etc.for depreciation straight line method. for exfor inventory LIFO.

Limitations. Performa of balance sheet. Adjustment.BALANCE SHEET Meaning. Essential parts of final A/c. .


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