FINAL ACCOUNTS (PPT)

FINAL ACCOUNTS

Final Accounts is the last step in the accounting process. Trial Balance is prepared at the end of the accounting year to know the balances of all the accounts & to test the arithmetic accuracy of accounts. But the basic objective of accounting is to know about the profit or loss during the previous year & present financial position. This can be known only if the Trading Account and Profit & Loss account and Balance Sheet are prepared at the end of the year. These are also known as FINANCIAL STATEMENTS which are prepared.

   From Trial Balance. Final Accounts include the preparation of :

1) Trading and Profit & Loss account and

2) Balance Sheet 

   as these two statements are prepared to give the final results of the business, both of these are collectively called final accounts. The accounting cycle finally ends with these statements as shown in the next slide: