STATEMENT OF PROFIT OR LOSS FOR THE YEAR ENDED ON......
STATEMENT OF AFFAIRS
A Statement of affairs is a statement showing the balances of assets (including cash and bank balance) on the right hand side and the balance of liabilities on the left hand side, on a particulars date. The difference in the total of two sides is known as capital.
CAPITAL = Total Assets – Total liabilities
A statement of affair is very similar to Balance Sheet as prepared for the business entities maintaining accounts under double entry system, though it should not be described as a Balance Sheet.A Statement of Affairs is prepared as follows :
STATEMENT OF AFFAIRS
as on.........
DISTINCTION BETWEEN BALANCESHEET AND STATEMENT OF AFFAIRS
Case I – When opening and closing capital are not given.
Illustration -1
Aarushi maintains incomplete records of her business. She wants to know the result of her business on 31st march, 2011 and for that, following information are available :
Personal expenses of Aarushi paid from business account amounted to ` 12,40,000 and goods worth ` 2,60,000 were withdrawn by her for personal use. She sold her car for ` 5,00,000 and invested that amount in to the business.
Calculate her profit or loss.Solution :
Step -1 : Calculate the amount of Opening Capital by preparing Statement of
Affairs at the beginning of the accounting period.
CBSE Accountancy Class XI ( By Mr. Aniruddh Maheshwari )
Email Id : [email protected]
