A profit and loss account itemises the income and expenditure of a business in a given period, say a year. This gives an indication of how well the business is trading. The Balance Sheet itemises the company's assets and debts at a particular moment in time, say the end of a trading year. This gives an indication of whether the company is solvent. If the company's debts outweigh the assets then it may need to consider winding up unless the people to whom the debts are payable indicate their willingness to wait for payment.
Profit and loss appropriation account shows the distribution of net profit amongst the shareholders in the form of dividend and transfer of profit to various reserves and issue of bonus share. profit and loss appropriation account is prepared after the preparation of profit and loss account. Profit and loss account provides the information about adjustment relating to last year. Profit and loss appropriation account also provides the information about the appropriation of dividend out of available profit. Profit and loss appropriation account is prepared after profit and loss account and before the preparation of balance sheet. Profit and loss appropriation account is a vital item of final account
profit is the balance when you pay all of the expenses the remainder that is left is the profit. and loss is when the expenses are greater than revenue means that the revenue is less and the expenses are more so when you subtract revenue from the expenses the result will be minus that is called loss E.g; 400 revenue - 800 expenses= -400 this is called net loss. income is the amount of revenue you received and expenditure is all the expenses you are going to pay whether it is purchasing or to such as buying equipment or paying utilities like water and electricity
wrote by Abdinasir Ahmed Jimale
Student of undergraduate İnternational Trade And management at İstanbul Şehir University. short005@hotmail.com
No difference. It is just a matter of symantics (different ways to say the same thing).
: Profit and loss account gives the actual information about net profit or net loss of the business for an accounting period, Profit and loss account gives the actual information about indirect expenses, Profit and loss account serves to show the ratio between net profit to sales, Profit and loss account helps in showing the ratio between net profit to operating expenses, Profit and loss account helps in controlling indirect expenses
Yes. Profit and loss account is a nominal account and also trading a/c to be prepared at the end of the year.
Profit and loss accont is used to calculate the profit or loss of business while profit and loss appropriation account is used to allocate or distribute net income or loss to share holders or different reserves account.
Arbitrage trading is trading that takes advantage of a difference in price between two or more different markets, to make a profit equal to the difference in the market prices. Arbitrage trading is useful in banks and brokerage firms.
When preparing departmental trading and a profit and loss account, expenses must be taken into account first. These include departmental expenses, and common expenses, including administrative expenses.
Income and expenditure account is used by not for profit companies as they are formed for not for profit basis that's why they cannot use profit and loss account.
i want to analyze the trading and profit and loss account for coca cola company could you help
account receivable- money coming in for profit account payble-money going out for a expense
There is no difference.
No difference.
Income and expense for not for profit organisations is same as profit and loss account but they cannot use the name profit and loss account because not for profit organisations are not formed to earn profit.