Question

Select the most appropriate answer the alternatives given below and rewrite the Sentences.

The capital in the beginning of the accounting year is ascertained by preparing_____________.
a) Receipts and Payment Account
b) Cash Account
c) Statement of Profit or loss
d) Opening Statement of Affairs

Answer 1

The capital in the beginning of the accounting year is ascertained by preparing opening statement of affairs.

Explanation: For determining the opening capital, the statement of affairs is prepared on the opening date. The opening capital will be the balancing figure, which is calculated by deducting the total opening liabilities from the total opening assets.