Question

"Profit and Loss account is made after preparation of final account" justify for or against the statement.​

Answer 1

Every business wants to know the incomes earned and expenses incurred during a particular period, usually at the end of the year.
Profit & Loss Statement/Account shows the profits/losses earned/incurred by a business for a month or a year. Companies use Profit & Loss Statement and others use “T Account” for these below mentioned reasons.
Profit & Loss Statement/Account is prepared for two main reasons.

i. To know the profits/losses earned/incurred by a business,

ii. Statutory requirements (Companies Act, Partnership Act or any other law)

Traditionally, there were two steps to know the profit/loss. It meant, the preparation of :

a. Trading Account

b. Profit & Loss Account

Trading account reflects the gross profit or loss of the business. Profit & Loss Account shows the net profit or loss earned by the company.