Following is the balance sheet of Neha, Nisha, and Nikki, who share profit and loss in proportion of 1/2, 1/3, and 1/6. They dissolved their firm on 31.12.2018. Balance sheet as on 31.03.2018 Liabilities Amount ₹ Assets (2024)

FAQs

What is the balance sheet of Profit and Loss account? ›

A Balance Sheet gives an overview of the assets, equity, and liabilities of the company, but the Profit and Loss Account is a depiction of the entity's revenue and expenses. The significant difference between the two entities is that the Balance Sheet is a statement while the Profit and Loss account is an account.

Any profits not paid out as dividends are shown in the retained profit column on the balance sheet. The amount shown as cash or at the bank under current assets on the balance sheet will be determined in part by the income and expenses recorded in the P&L.

The balance sheet demonstrates how all assets, liabilities, and shareholders' equity are accounted for. The income statement, also known as the profit and loss statement, shows where a company's profits and expenses came from and went over the period.

Accounting groups that make up the balance sheet include assets, liabilities, and equity. These include among others assets i.e. cash and property that a firm possesses. These obligations fall under the category of liabilities as exemplified by loans and payables.

This derives the formula: Profit = Selling price - Cost Price. However, if the cost price of a product is more than its selling price, there is a loss is incurred in the transaction. This derives the formula: Loss = Cost Price - Selling Price.

The balance sheet is based on the fundamental equation: Assets = Liabilities + Equity.

In balnce sheet, net loss may be shown in various ways. It may either be shown in Assets side as P/L (Dr.) If your company has practice of creating Accumated profits, the loss of current year can be set off from those past profits.

What Is the Difference Between a P&L Statement and a Balance Sheet? A company's P&L statement shows its income, expenditures, and profitability over a period of time. The balance sheet, on the other hand, provides a snapshot of its assets and liabilities on a certain date.

A balance sheet is a financial statement that reports a company's assets, liabilities, and shareholder equity. The balance sheet is one of the three core financial statements that are used to evaluate a business. It provides a snapshot of a company's finances (what it owns and owes) as of the date of publication.

Which of the following accounting groups appears under the profit & loss statement as well as the balance sheet? ›

Any Groups created under Assets and Liabilities form a part of the Balance Sheet whereas Groups under Expenses and Incomes are part of the Profit & Loss Account.

A balance sheet is a financial statement that contains details of a company's assets or liabilities at a specific point in time. It is one of the three core financial statements (income statement and cash flow statement being the other two) used for evaluating the performance of a business.

The report is divided into two sections: income and expenses. Your total revenue is listed under the income section, while your total expenses are listed under the expenses section. To calculate your net profit or loss, simply subtract your total expenses from your total revenue.

Debit Balance of P/L ac means a loss to the firm! It is something that the firm is not liable to pay to the members of the firm (owners). Hence -ve balance in Liabilities Side which can be shown on Asset Side. P/l dr balance is a fictatious asset.

So what's the difference? As we've covered, a P&L statement is an overview of your profits and losses over a particular period of time, such as a month, quarter or year. A balance sheet, on the other hand, shows your business's assets and liabilities at a specific point in time rather than over a period.