how to prepare Profit and los accounts ?
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Answer / shaik jaffar ali
After preparing Trading A/c then we will prepare P&L A/c as
well as P & L Appropriation A/c. After preparing Trading
A/c the Gross profit or Gross loss should be shown in
Tranding A/c. If Gross Profit is there the profit should be
carried farward of the P&L A/c on credit side. or If the
Gross Loss should be shown carried farword that Gross Loss
on the Debit side of P & L A/c. and next all indirect
expenses must be add on the debit side of P&L A/c ex:-
(salaries,rent, wages,VAT tax,Bad Debts,Electricity Bill,
Telephone Bill, Mobile or cell phone bill,printing &
stationery, postage & telegrams,Discount
allowed,Depriciations etc). and any Discount received,
Commission Received should take on the credit side of the P
& L A/c. and then calculate all Debits & Credits
total.After calculating the Credit Balance is more than the
Debit Balance the remaining balance is Net Profit.as the
same way the Debit Balance is more than the Credit Balance
that amount is Net Loss. This is complete Profit & Loss A/c
| Is This Answer Correct ? | 138 Yes | 16 No |
Answer / sreekanth
In a simple way to say wt is meant my profit & loss account
is .debit side (all office expenses like salaries, rent,
electricity etc) and on credit side( the gross profit and
commission recvd and discount recvd ).
| Is This Answer Correct ? | 59 Yes | 7 No |
Answer / vinotha.v
INCOME. £
Sales 23850
EXPENDITURE.
Selling Expenses .1800.
Bank Interest .450.
Purchases .12000.
Wages & Salaries .1500.
Rent & Rates .450.
Telephone .600.
ESB .525.
Insurance .525.
_____.
Total expenditure .17850.
Net Profit .6000.
Balance Seet as at ?.
Fixed Assets:-. £
Land & Buildings .8400.
Plant & Machinery .3450.
Motor Vehicles .450.
Total Fixed Assets .12300.
Curent Assets.
Debtors .3000.
Bank & Cash .2700.
Total current assets .5700.
Less current Liabs.
Creditors .1200.
Net current assets .4500.
Total Assets .16800.
_____.
Liabilities.
Long term loan .1800.
Share Capital a/c .3000.
Share Premium A/c .1500.
P&L a/c b/f 4500.
Plus Profit 6000 .10500.
Total Liabilities .16800.
When you post the answer, it throws the alignment of the
figures out. They should all be under each other directly
under the pound sign, all of which should be further to the
right, away from the account descriptions. It is a very
simple P&L a/c and Balance Sheet format. You should be able
to present it with all the figures under each other.
Ideally, you need a spread sheet for that, unless you are
going to present it in hand written form. Total assets
balance total liabilities at £16800. Profit for the year is
£6000 from the P&L a/c, which is transferred to the balance
sheet and added to accumulated profits from the previous
years.
| Is This Answer Correct ? | 41 Yes | 10 No |
Answer / sujatha
trading a/c is the statement which shows the gross profit
or gross loss of a particular company or a firm at the end
of the year.in the p&l a/c statement we will enter all
indirect expenses on the debit side, and all indirect
incomes on the credit side.from this statement we will come
to know the net profit or net loss of a company or afirm.
| Is This Answer Correct ? | 35 Yes | 6 No |
Answer / rushikesh
Follow the procedure as I Say
First of all we have to Post journal entries,
then from journal we have to post these entries in there
respective ledgers.
then from ledgers make Trial Balance
Feom trail Balance we will be able to make Trading Account
and P&L Account. Other than factory income & factory
expenses all entries should be posted in the P & L account.
| Is This Answer Correct ? | 38 Yes | 10 No |
Answer / srikant
After complition of Trading A/c. The Gross profit will
transfer to P/L A/c or carry forward to P/L A/c. If there
is Gross profit it goes to right hand side of P/L A/c or if
there is Gross loss then the loss goes to left hand side of
P/L A/c.P/L A/c has two side, one is Expenses side & other
is Income Side. Expenses Side :- Salary, Electricity bill,
stationery exp, Printing exp.,Carriage outward, Bad debts &
all indirect expenses & Income side :- Commission received,
Interest received,Bad debts recovered etc. After complition
of entries, if income is higher than expenses it should
write Net Profit or if Income is less than expenses it
should Net loss.
| Is This Answer Correct ? | 23 Yes | 3 No |
Answer / viswajanani
debit side (all office expenses like salaries, rent electicity etc ) and credit side (the gross profit , commision recived and discount recived)
in p/l ac we will enter all the indirect expenses on the debit side and all indirect incomes on the credit side from this we will come know about the profit or loss of the company or firm
| Is This Answer Correct ? | 6 Yes | 2 No |
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