Finalisation Accounts preparation
First of all we journalise the entries and post into the ledgers and again prepare the
trial balance after that trading and profit & loss a/c balance sheet. Again we will have
to analyse the all aspects for decision makin
The final accounts are:
Manufacturing Account
Trading Account
Profit And Loss Account
Profit and Loss Appropriation Account and
Balance Sheet.
The process of finalisation is something like this:
Prepare a Trial Balance
See whether it agrees or not
If it does not agree then investigate the ledgers
That process means that see whether Purchase ledger tallies with cash book purchase
entries etc.
After that you are ready to finalise the accounts but
provide for taxes
prepare provision for doubtful debts
prepare gross block of fixed assets and depreciation
prepare net block of fixed assets
prepare gross and net block of inventory and value inventory at cost or market value
whichever is less
for this purpose the market value of the inventory need to be ascertained
prepare bank reconciliation statement and tally all bank balances with bank accounts
prepare gross and net block of furniture and fixtures
provide for wages and salaries etc if they are payable after finalization period
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