Final account interpretation
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Every businessman goes into a business with the idea of making profit, which is the reward of this effort. He tries his best to get more and more profit at the smallest economic cost.
The role of accounting is to accumulate accounting data in such a manner that the amount of profit made or loss sustained during a particular period ascertained. The "final accounts" enable us to check on the conduct of the business, and to discover whether it is being run profitably. They are the means of conveying to the owner/owners, management, creditors, and interested outsiders a concise picture of profitability and financial position of the business.
The preparation of the final accounts is not the first stage of an accounting cycle but they are the final products of the accounting cycle, that is why, they are called final accounts.
These accounts summaries all the accounting information recorded in the original books of entry and the ledgerconsisted of hundreds of thousands of pages.
The final accounts or financial statements consists of:
Trading and profit and loss account or income statement, which is prepared to know the profit earned or loss suffered by the business during a specific period.
Balance sheet, which is prepared to know the financial position of the business on a particular date.
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The role of accounting is to accumulate accounting data in such a manner that the amount of profit made or loss sustained during a particular period ascertained. The "final accounts" enable us to check on the conduct of the business, and to discover whether it is being run profitably. They are the means of conveying to the owner/owners, management, creditors, and interested outsiders a concise picture of profitability and financial position of the business.
The preparation of the final accounts is not the first stage of an accounting cycle but they are the final products of the accounting cycle, that is why, they are called final accounts.
These accounts summaries all the accounting information recorded in the original books of entry and the ledgerconsisted of hundreds of thousands of pages.
The final accounts or financial statements consists of:
Trading and profit and loss account or income statement, which is prepared to know the profit earned or loss suffered by the business during a specific period.
Balance sheet, which is prepared to know the financial position of the business on a particular date.
I HOPE IT WILL HELP YOU
IF IT HELPS YOU PLEASE MARK ME AS BRAINLIEST
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