The capital balances are ascertained by preparing __________.

Statement of Affairs

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Cash Account

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Drawings Account

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Debtor's Account

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Solution

The correct option is B Statement of Affairs
Option A is correct one.
Under the Single Entry System also, capital is ascertained in this manner. Statement of Affairs (not at all different from balance sheet) is prepared and assets and liabilities put on the proper sides. The difference between assets and liabilities is capital.

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Similar questions

Explain how the following may be ascertained from incomplete records

(a) Opening capital and closing capital

(b) Credit sales and credit purchases

(d) Closing balance of cash

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