Profit & Loss Account

when you closed accounts first upall you see the proper heads ae given and transferred entry is propely made or not.all basic principal accounting are made or not pl clerify your quiry properly

While closing accounts and preparing P&L account ; 1. Provisions would have not been made or if suppose made, it can be excess or short. 2. Closing stock valuation, if applicable. 3. Expenses which attract service tax that remain unpaid on closing date may be transferred entirely to P&L without separating the service tax component. 4. Interest incomes which may extend to period beyond closing dates may be recognised fully in this period. However, these are general and routine problems which creep up while closing accounts. Variety of problems may be encountered depending upon the size of the organisation, its business nature and other things which cannot be put in absolute terms. These can be learned only through sheer experience.

Some of the problems, in general are: 1. Year end purchases might not have been accounts. 2. Interest income might not have been recognised. 3. Closing stock valuation 4. Expenses provision 5. Provision for taxation 6. Depreciation entries 7. Prior period items 8. Income tax refund adjustment 9. Adjustment for non moving items Problems may even be different depending upon the status of the assessee.

In my view the problems faced by a person while closing accounts and preparing P&L Account are * Stock, * Provisions for Expenses, * Accruals, * Adjusting Entries for Assets * Provisions for Income TAx * Previous Year Adjustments, if any * Any Interest Receivable Or Payable