Question

Credit balance of profit and loss account shows net profit of the business. (State True or False)

Answer 1

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True


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Answer 2

The given statement - Credit balance of profit and loss account shows net profit of the business is true.

* In a profit and loss account, there are two sides- credit and debit.

* All the income or profit incurred by a business firm gets accumulated on the credit side of the account as a credit balance.

* On the other hand, all the expenses are listed as debit balance on the debit side of the account.