Preparation of Bal. Sheet and Statement of Affairs of Propri

Kannan M (Consultant) (85 Points)

25 October 2010  

When preparing accounts for an Individual (a Proprietor) in Tally, we prepare P & L and Balance Sheet. My doubt is whether we have to account only Business transactions and cash withdrawn for personal expenses like investment in lic and purchase of house are also to be accounted and included in the balance sheet. Second thing is, when preparing ITR 4 for income tax purpose, whether we have to show all in the Balance sheet like personal investments in lic and purchase of house and loan taken for purchase of house. Or all personal related like purchase of house, loan taken for purchase of house, personal investments in lic, mutual fund etc. to be shown in Statement of Affairs of an individual which is not to be shown in the business balance sheet and Income tax return.