Question

Indirect Expence are Debited in

a) Balancesheet b) P/ L account c) Trading Acc. d) None of these​

Answer 1

profit and loss of account

Answer 2

ANSWER :

Indirect Expenses are Debited to

a) Balance Sheet

b) P/ L Account ✓

c) Trading Account

d) None of these

• Indirect Expenses are Debited to P/L Account (Profit and Loss Account).

MORE TO KNOW :

• According to R.N. Carter, "A Profit and Loss Account is an account into which all gains and losses are collected, in order to ascertain the excess of gains over the losses and vice-versa".

• Profit and Loss Account is a part of Income Statement as well as Final Accounts.

• In Profit and Loss Account, all indirect expenses are compared with the total of Gross Profit/Gross Loss and non-operating income in order to ascertain the Net Profit/Net Loss of the business.

• Profit and Loss Account shows the net result of the business.

• Proft and Loss Account is prepared after the preparation of Trading Account and it starts with the balance of Gross Profit or Gross Loss.

• All the indirect expenses are debited to the Profit and Loss Account.