Balance Sheet
Balance Sheet: The Trading Account provides the information regarding the gross profit or gross loss during the Accounting period. Similarly, the profit and loss Account provides the information regarding profit or loss made by a businessman during the Accounting period. But this is not at all that a businessman wants. What he wants is his financial Accounting position on the closing date of the Accounting period. He wishes to know whether his capital increase or decreased since the beginning of the period and various Assets and liabilities he has on the closing date of the business period. For obtaining this information he prepares a statement of his assets and liabilities, know as the Balance Sheet. Thus a Balance Sheet is prepared to know the financial position of the business and the capital of the trader on a particular date. The Balance Sheet shows that what a business owns and what is owes to others on a particular date. We can say that Balance sheet is a snap shot of t