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Functions of Accounting
Accountancy
answered on 26-Jan-23 18:18
It says that Accounting measures past performance and PRESENT financial position. Question is this , without preparing current period's Profit and Loss a/c, how can it measure PRESENT FINANCIAL position ? Please guide me
latest answer
It is true that Accounting measures past performance and PRESENT financial position. Past performance means the entity's performance in the past accounting year is reflected thought P & L. The P & L can be prepared only when the past period ends and it shows the performance of the entity in the past period. Present Financial Position refers to the current position of the entity through its Balance Sheet. It shows the entity's position as on a particular date. So, Past Performance - P & L Present Position - Balance Sheet And, it is true that Balance Sheet can be prepared only after the preparation of the P & L
Thankachan Jimmy
CMA Inter
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317
Managerial remuneration - account
Accountancy
answered on 23-Jan-23 09:21
For the computation of managerial remuneration the questions quote two depreciation of a company One as per the act and another what the company has charge from p&l So does it possible that the depreciation as per the Act and provided depreciation would be different??
latest answer
Yes that difference may due to some provisions of act and depreciation in income tax allows only wdv method unless there is exemtion by act ex for electricity company Refer AS 22
Atharv Sankliya
CA Final
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276
CARO 2020 inventory verification
Accountancy
answered on 30-Jan-23 17:20
What does the clause on inventory of Caro 2020 mean by discrepancy of 10% or more ??
latest answer
Difference between what is shown in inventory records vs what is physically present.
Atharv Sankliya
CA Final
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322
overriding preferential creditors in SOA
Accountancy
answered on 24-Jan-23 09:21
why overriding preferential creditors are not considered in statement of affairs
latest answer
can you elaborate your query or share the question you are referring to
SK Png
CA Inter
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1
313
Accounts from incomplete records single entry
Accountancy
answered on 21-Jan-23 18:23
In illustration 3 at statement of profit the current account balance as on 31-3-20X1 is deducted. What means that? What represent that ?
latest answer
it is nothing ,statement of profit derives from current account so if you add debit side of current account and subtract credit side you get profit
Sai sruthi
CA Inter
★ 640
1
362
Amalgamation
Accountancy
answered on 23-Jan-23 17:06
Should the INTER OWING amounts between companies be reduced from 'Debtors & Creditors' while finding 'net asstes'?
latest answer
No.
Angel Maria Varghese
CA Final
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2
379
change in accounting policy
Accountancy
answered on 23-Jan-23 19:58
change in accounting policy or introduction of new policy 1)creating a provision for doubtful debt which was not a practice in past 2)management decided to pay pension by a scheme which was not a practice in past
latest answer
Mentioned in As 5
Vamsi Krishna
CA Inter
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6
633
Insurance Claim
Accountancy
answered on 20-Jan-23 14:50
Why we are not considering the NP +ISC as GP while Calculating increase cost
latest answer
Yeah that is for calculation of gross profit. Gross profit on annual turnover means percentage of gross profit calculated. By NP+ ISC how will you compare that with annual turnover. So we consider GP rate
Snehashis Mohanty
CA Inter
★ 35
9
353
Insurance Claim
Accountancy
answered on 24-Jan-23 09:24
How could we consider 1l as reduction in turnover avoided because here our actual turnover is 1lakh and Reduction in turnover is 3 lakh so what we are not taking 3 lakh as reduction in turnover avoided?
latest answer
Reduction is 3 lakhs. Reduction avoided is 1 lakh.
Snehashis Mohanty
CA Inter
★ 35
1
297
What is capital profit and revenue profit
Accountancy
answered on 12-Jun-24 11:58
What is capital profit and revenue profit
latest answer
Capital Profit Definition: Capital profit is the profit earned from activities that are not part of the regular business operations. These profits are usually non-recurring and arise from transactions involving the capital structure of the business. Example: A company sells a piece of machinery that it no longer needs. If the machinery was purchased for ₹3,00,000 and it is sold for ₹4,00,000, the company makes a capital profit of ₹1,00,000. This profit is not part of the company's regular sales revenue from its core business activities. Revenue Profit Definition: Revenue profit is the profit generated from the regular business activities or operations. This type of profit is recurring and forms the core income for the business from its day-to-day activities. Example: A retail store buys goods for ₹2,00,000 and sells them for ₹3,00,000. The revenue profit is the difference between the sales revenue and the cost of goods sold, which is ₹1,00,000. This profit is part of the store's normal operations and contributes to its overall income from regular sales activities. In summary: Capital profit comes from non-recurring transactions involving the capital assets of a business, such as selling an old piece of equipment. Revenue profit comes from the regular, recurring operations of the business, such as selling merchandise in a retail store.
Atharv Sankliya
CA Final
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