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because profit is earned on the capital invested which is not the company's money.
capital is also like a liability and the profit should actually be given to the owner and the money is still there with the company so it is again a liab. for the company to pay the profit which is a return on the capital invested by the owner.
What else can I help you with?
Where does Netprofit appear in the Balance Sheet?
Net profit appears on liabilities of balance sheet . Net profit is added to capital.
Do provisions for loan loss go in the balance sheet or profit and loss?
Profit and Loss.
The balance sheet of a firm shows?
profit or loss for the period
What relationship is there between the accounting equation and the balance sheet?
The relationship between the accounting equation and the balance sheet is the NET PROFIT. ( I THINK :/ )
What is the balance sheet equation?
balance sheet is a record of debit and credit entry of account in order to obtain the net profit of the business.
Where does Netprofit appear in the Balance Sheet?
Net profit appears on liabilities of balance sheet . Net profit is added to capital.
What are the main features of a balance sheet?
The main parts of a balance sheet are profit, loss and inventory.
By which information about performance is disclosed?
Balance Sheet & Statement of Cash flows
How can find out profit into balance sheet?
You can do this by creating an income statement, where you minus the costs of good from sales and then also minus expenses from this number, this profit is then added to your retained earnings number on the balance sheet.
Where are surplus shown in balance sheet?
With non-profit organisations, when the balance sheet doesn't show a loss, but what would be classified a profit for profit organisations, it is called a surplus. When it is what would be considered a loss for profit organisations, it is called a deficit.
Information about performance of company is disclosed by?
balance sheet and cash flow statement
Infoformation about performance of company is disclosed by?
balance sheet and statement of cash flow
What are the reason where the balance sheet will not tally?
Balance sheet is the summary of Assets ,Liabalities , and profit or loss from Profit and loss account. following are the common reasons 1.As Purely based on nduble entry system For each ledger debits there should a equlent ledger credit on all transactions. 2. We can divide ledgers into Balance sheet items and Profil and loss account items. Balance sheet ledgers are ledger balances which directly reflects in Balance sheet Profit and Loss ledgers are ledgers which is reflecting only in Profit and loss account not in balance sheet. 3. Check the opening balance sheet, difference in opening balance sheet may the reason.
Where does letter of credit comes in balance sheet?
the letter of credit is not shown in the balance sheet, since it's a contingent commitment but it should be disclosed in a separate note
Where profit and loss posted in balance sheet?
Profit will add with capital and loss will deduct from it.
Do provisions for loan loss go in the balance sheet or profit and loss?
Profit and Loss.
Three main sectons of a balance sheet?
PROFIT, LOSS, AND INVENTORY ARE OFTEN CONSIDERED MAIN SECTIONS OF A BALANCE SHEET.
