Accounting Period(Periodicity) Concept Video Lecture | Accountancy Class 11 - Commerce

periodicity concept periodicity concept
actually again is comes from the going
concern cancer since the business goes
on forever let's say the business goes
on for 50 years we need to periodically
we cannot wait for 50 years or till the
business closest to find out how the
business history so periodically we need
to know at regular intervals we need to
know how well the business history what
are the results of the operations of the
business what is the profit that the
business is making it is just like in
any case in an everyday example when a
child goes to school till he graduates
graduates we do not know in his level of
performance how he is performing every
year in order to do so we have an annual
exam each year to test his competence to
move on to the next level similarly in
accounting every year we prepare
something called the profit and loss
account we have we have a date called
when the books of accounts are closed it
may be usually usually the year in India
is other financial year it print too
much books of accounts are kept from
April 1st to March 31st of the next year
so periodically which is usually a year
a 12-month period
profit and loss account is drawn or the
profits are asserted periodically
usually yearly to ascertain profits at
regular intervals this of course helps
us to keep comparison to
where the performance of the business
each year in addition to the profits and
that year in the last year of each year
we also ascertain the financial position
to find out what the assets of the
business are and what its liabilities