DK Goel Solutions Class 11 Chapter 21 Financial Statements

1. DK Goel Solutions Class 11 Chapter 21 Financial Statements DK Goel Accountancy Class 11 Solutions Chapter 21 Financial Statements, which is laid out by master Accountancy instructors from the most recent form of DK Goel Class 11 Accountancy books. We, at Dk Goel Solutions help students to fathom every one of the hypotheses, specifically. There are various ideas in Accountancy, however the ideas of Trial Balance, Depreciation and Bank Reconciliation Statement (BRS) are required. DK Goel Solutions Class 11 – Chapter 21 Short Answer Questions Question 1: What is the used of financial statement for employees and trade union? Solution 1: They will judge on the basis of the financial statement how much bonus and raise in their salary is probable from the company’s earnings. Question 2: What is the use of financial statement for potential investors?

2. Solution 2: With the aid of financial statements, they will determine the short-term and long-term financial soundness and earning potential of the firm. The revenue pattern, earnings trend, shortcomings and the outlook for the company’s potential growth can also be analysed. Question 3: What is meant by operating profit? Solution 3: The benefit gained from the company’s regular operational operations is operating profit. It is done by deducting the express operating profit from the gross profit. Expenses that are linked to the company’s primary or regular functions are considered operational expenses. Question 4: What is meant by Indirect Expenses? Give two examples. Solution 4: Indirect costs are any costs that are borne that are not directly related to the procurement of products or the production of goods. Below are the two indirect expense examples: 1. Office Expenses 2. Salaries Question 5: Give four points of distinction between Trading Account & Profit and Loss Account. Solution 5: Question 6: What purpose does a Balance Sheet serve? Solution 6: To determine the financial status of an organization on a given date, a balance sheet is compiled. This suggests liabilities on the left side and assets on the right side.

3. Question 7: What is meant by “Grouping’ and ‘Marshalling’ a Balance Sheet? Solution 7: Grouping means showing common headings of assets or liabilities of a similar nature and Marshalling means showing the assets and liabilities in the correct order. Question 8: Write the various Assets in order of liquidity in a Balance Sheet. Solution 8: An asset that is more readily convertible into cash such as cash in hand is first written according to this process and then proceeds those assets that are relatively less readily convertible so that the least liquid asset such as goodwill is last seen. Question 9: When assets are listed in order of their liquidity in a Balance Sheet, which should be listed first — Buildings or Cash in hand? Solution 9: An asset that is more readily convertible into currency, such as cash in hand, is first written and then follows those assets that are relatively less readily convertible in order to last reveal the least liquid asset, such as goodwill. Question 10: Explain the Current Assets and Non-Current Assets. Solution 10: Current assets:- Current assets are those assets retained for resale or for cash conversion. This are the properties that are likely to be realized in one year or over the usual operational cycle time. By selling these properties, a corporation generates profit but not by holding them for a longer time as stock. These properties are transient in nature and, from time to time, can alter. This are also regarded as commodities that are floating or circulating. Non-current assets:- Non-current properties, such as property and building, plant and equipment, motor vehicles, furniture, etc., are assets that are purchased for continual use and continue for several years. Numerical Questions Question 1: Prepare a Trading Account from the following particulars for the year ended 31st March 2017:-

4. Closing Stock is valued at Rs. 6,00,000. Solution 1 Trading Account for the year ended March 31,2017 Point of Knowledge:- Trading Account is the account that reveals the gross profit or gross loss. It is credited with the amount of sales of goods and debited with the opening stock of goods along with the direct expenses related to the sales made. Trading Account is prepared to know gross profit or gross loss during the accounting period.

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