What do we say if the owner asks where the profit in the profit and lost account really is?
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Finalisation accounts
Replies (8)
Simple, compare last years stamens with this year.
Find out if sales increased
find out if the expenses decreased
find out of finance costs decreased.
Like that, compare the statement and find out what increased and what decreased. That increased your profits.
Analyse Cashflows as well.
Verify the sales, expenses, stock etc. if they are increased or decreased
I think he is asking you because of difference in cash balance and profit so, prepare a cash flow statement and explain it
Show all the registers, books of accounts etc
simply can show profit and loss account balance credit balance shows as Net Profit.
Yes this can also be shown
You can prepare proper p&l account, and balance sheet and explain the things
The credit balance is itself net profit in profit & loss account in final accounts.
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