Commerce Exam > Commerce Questions > The opening capital is ascertained by prepari...
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The opening capital is ascertained by preparing
- a)Opening statement of affairs
- b)Creditors
- c)Debtors
- d)Cash book
Correct answer is option 'A'. Can you explain this answer?
Most Upvoted Answer
The opening capital is ascertained by preparinga)Opening statement of ...
We prepare the Statement of Affairs at the beginning of the year to ascertain the opening capital and at the end of the year to ascertain the closing capital. However, the items of assets and liabilities are ascertained from vouchers, physical count and other relevant documents.
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The opening capital is ascertained by preparinga)Opening statement of ...
Opening Capital Determination Process
Opening Statement of Affairs:
The opening capital is ascertained by preparing the opening statement of affairs. This statement lists all the assets and liabilities of a business at the beginning of a specific period. It includes details such as cash, bank balances, debtors, creditors, loans, and other financial information.
Importance of Opening Statement of Affairs:
- Provides a snapshot of the financial position of the business at the start of the period
- Helps in calculating the opening capital which is essential for determining the financial health of the business
- Serves as a reference point for analyzing the changes in assets and liabilities over time
Steps to Prepare Opening Statement of Affairs:
1. List all assets such as cash, inventory, equipment, etc.
2. List all liabilities like creditors, loans, outstanding expenses, etc.
3. Calculate the total assets and total liabilities
4. Subtract total liabilities from total assets to determine the opening capital
By following these steps and preparing the opening statement of affairs, businesses can accurately determine their opening capital which is crucial for financial analysis and decision-making.
Opening Statement of Affairs:
The opening capital is ascertained by preparing the opening statement of affairs. This statement lists all the assets and liabilities of a business at the beginning of a specific period. It includes details such as cash, bank balances, debtors, creditors, loans, and other financial information.
Importance of Opening Statement of Affairs:
- Provides a snapshot of the financial position of the business at the start of the period
- Helps in calculating the opening capital which is essential for determining the financial health of the business
- Serves as a reference point for analyzing the changes in assets and liabilities over time
Steps to Prepare Opening Statement of Affairs:
1. List all assets such as cash, inventory, equipment, etc.
2. List all liabilities like creditors, loans, outstanding expenses, etc.
3. Calculate the total assets and total liabilities
4. Subtract total liabilities from total assets to determine the opening capital
By following these steps and preparing the opening statement of affairs, businesses can accurately determine their opening capital which is crucial for financial analysis and decision-making.
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The opening capital is ascertained by preparinga)Opening statement of affairsb)Creditorsc)Debtorsd)Cash bookCorrect answer is option 'A'. Can you explain this answer?
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The opening capital is ascertained by preparinga)Opening statement of affairsb)Creditorsc)Debtorsd)Cash bookCorrect answer is option 'A'. Can you explain this answer? for Commerce 2025 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about The opening capital is ascertained by preparinga)Opening statement of affairsb)Creditorsc)Debtorsd)Cash bookCorrect answer is option 'A'. Can you explain this answer? covers all topics & solutions for Commerce 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for The opening capital is ascertained by preparinga)Opening statement of affairsb)Creditorsc)Debtorsd)Cash bookCorrect answer is option 'A'. Can you explain this answer?.
The opening capital is ascertained by preparinga)Opening statement of affairsb)Creditorsc)Debtorsd)Cash bookCorrect answer is option 'A'. Can you explain this answer? for Commerce 2025 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about The opening capital is ascertained by preparinga)Opening statement of affairsb)Creditorsc)Debtorsd)Cash bookCorrect answer is option 'A'. Can you explain this answer? covers all topics & solutions for Commerce 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for The opening capital is ascertained by preparinga)Opening statement of affairsb)Creditorsc)Debtorsd)Cash bookCorrect answer is option 'A'. Can you explain this answer?.
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