Opening balance of capital can be ascertained by preparing an 'Opening Statement of Affairs'. Statement of Affairs is quite similar to a Balance Sheet (NOT exactly) Closing Capital is deducted from the Closing Capital to get the Closing Capital of the business. If the Closing Capital is less than opening capital, it is a loss. Adjustments which result in increase in incomes and gains must be added to the profit figure to get the accurate net profit.
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Two Methods to Find Out the Profit or Loss From Incomplete Records
Opening balance of capital can be ascertained by preparing an 'Opening Statement of Affairs'. Statement of Affairs is quite similar to a Balance Sheet (NOT exactly) Closing Capital is deduct…