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why the debit balane of p&l a/c shows in asset side of
balancesheet
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Answer / bhupinder s
it is because
debit bal of P&L shows loss
profit in liability shows tht company is liable to pay the profit amt to shareholders
and
P&L(loss) in asset side shows that shareholders are liable to pay the company
refer: company and shareholders are diff entities
| Is This Answer Correct ? | 51 Yes | 7 No |
Answer / mahak
Because all assets contain Debit balances as per the
REAL RULE OF ACCOUNTING:
WAT COMES IN IS DEBIT
WAT GOES OUT IS CREDIT
| Is This Answer Correct ? | 48 Yes | 15 No |
Answer / gupta
Profit and loss account nature is Nominal Account.As per
Nominal account rule we have to debit all expenses and
losses and we have to credit all incomes and gains.Therefore
loss is a outcum of Profit and loss account i.e. its nature
is Nominal account.Therefore it will have debit Balance and
all debit balances will go Assets side of balancesheet.
| Is This Answer Correct ? | 14 Yes | 5 No |
Answer / bharadwaj
P&L debit balance means loss.
Why loss shown on assets side???
Ans always will be write off in future which means future
profit retained with company in the name of write off.
unless write off the profit is to be given to share holder,
as the profit is not given to share holders and retained n
future profits, P&l debit balance is treated as Asset
| Is This Answer Correct ? | 0 Yes | 0 No |
Answer / faruk.id
P&L A/c debit balance means oever exp. on income , as per
nominal rule expenses is debit so it is recorded unsder
asset side in balance sheet
| Is This Answer Correct ? | 2 Yes | 4 No |
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