Question

Preparation of TrialBalance,TradingA/c,Profit & LossA/c and Balance Sheet is the featureofaccounting. (a)Classifying (b)AnalysingandInterpreting (c)Residents (d)Communicating​

Answer 1

ANSWER :

★ (b) Analysing and Interpreting

• ✎ Preparation of Trial Balance,Trading A/C, Profit & Loss A/C and Balance Sheet is the Analysing and Interpreting feature of accounting.

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EXPLANATION :

From the analysis of the definitions of accounting given by different authors, brings out some features of accounting. The features of Accounting are : Identifying the financial event; recording of business transactions; classifying the business transactions; summarising/analysing of business transactions and interpreting the result respectively.

• ➻ After identifying the financial events, business transactions are recorded in the books of accounts and after recording the transactions; these are classified with the help of journal and ledgers.

• ➻ Trial Balance is prepared from the balanced of ledger accounts in order to summarise and analyse the business transactions.

• ➻ After summarising and analysing, the result of the business is interpreted by preparing Trading A/C, Profit and Loss A/C and Balance Sheet.

Therefore, preparation of Trial Balance,Trading A/C, Profit & Loss A/C and Balance Sheet is the accounting feature of Analysing and Interpreting.