P&L items  are Indirect expense and Indirect incomes. 
Balance Sheet items are Assets & Liabilities

ALL EXPENDITURE & LOSS, ALL INCOME & GAIN. THIS ITEM COMES 
TO PROFIT & LOSS A/C.

ALL ASSETS & LIABLITIES COMES TO BALANCE SHEET.

OUTSTNDING COMES UNDER P & L A/C AND B/S.

All revenue nature items will come under Profit & loss
account. All capital nature will come under Balancesheet.

Gross profit or loss transfered from trading
account.management ,office,administrative expenses,selling
and distribution expenses,financial expenses,commision
received,discount earned,interst received,rent
received,these are included in p&L a/c .if profit is more
expenses is less is called net profit.if profit is less
expense is more is called net loss.net profit or net loss
transffered to balance sheet.Balance sheet it includes share
capital,sundry creditors,bills payble,debentures,loans
advance ,cash in hand,b.o.d,longterm loans.goodwill,building
,investment,palnt &machinery,vehicle,furniture
&fixtures,loose tools,copy rights,land &buildings,sundry
debtors,bills receivable,cash at bank,closing stock .

Profit & Loss A/c. includes all revenue reciepts and 
expenditures. Where as Balance Sheet contains the captial 
Reciepts & Expenditures. 

Under the mercantile system, all the oustandings & accruals 
shall be taken in the P & L a/c. and B/S.