account is an extension of the profit and loss account itself, however, there is a fundamental difference between profit and loss profit and loss appropriation account. Other affected Ledger Accounts (Nominal) Purchases a/c DrCr Date Particulars Amount Date Particulars Amount To Cash To Ram 50,000 15,000 30/06 5 By Trading and P/L a/c 65,000 Total 65,000 Total 65,000 Sales a/c DrCr Date Particulars Amount Date Particulars Amount 30/06 5 To Trading. The gross profit will be affected if discount is treated. Trial Balance of M/s Trinity Foods" as on 30/06/20_5 after closing Nominal accounts Particulars L/F Amount (Dr) Amount (Cr) Cash Capital Bank Furniture Ram Rahim Trading and Profit Loss,000 77,000 25,000 50,000 1,00,000 15,000 47,000 Total 1,62,000 1,62,000.
Trading, account and, profit and, loss, account and Balance Sheet - An Example
XYZ Balance Sheet For the year ended 31st, December 2005 Assets Liabilities Current Assets: Current Liabilities: Bank balance 20,000 Sundry creditors 40,000 Bills receivable 50,000 Bank loan 100,000 Sundry debtors 100,000 Fixed and Long Term: Closing stock 90,000 Capital 171,500 Fixed Assets: Net profit 264,500. Purchases - Debit Balance Sales - Credit Balance Salaries and Wages - Debit Balance Rent Paid - Debit Balance To ascertain the profit or loss made by the organisation, the balance in these accounts should be transferred to the "Trading and Profit Loss a/c". Since a credit balance in a nominal account indicates a gain, we can say that there is a profit. The journal entries pertain to the whole of the accounting period. Timing, it is prepared after the trading account. Journal in the books of M/s Trinity Foods for the period from 1st June 20_5 to 30th June 20_5. And L/F columns is avoided to make the presentation look unclutterd. Ledger Accounts Use of the column J/F and the suffix a/c after the name of the account head is avoided to make the presentation look unclutterd.
Trading and profit and loss account format pdf