Question
Explain the difference between Statement of Affairs and Balance Sheet.
| Points | Statement of Affairs | Balance Sheet |
| $1.$ Basis | This statement is prepared by balances and estimated values from incomplete records as per single entry system. | This statement is prepared from the account of complete records and from the amount of systematic records of double entry system |
| $2.$ Trial Balance | Trial balance can't be prepared in single entry system. Hence arithmetical accuracy can't be verified. | Before, preparing this statement, arithmetical accuracy can be verified by preparing trial balance. |
| $3.$ Financial Picture of business | A clear picture of the actual financial position of business cannot be ascertained from this statement. | This statement shows true and fair view of financial position of business. |
| $4.$ Trustworthy | In this system, information is estimated, so it is not trustworthy. | In this, system, information is fixed, so it is trustworthy. |
| $5. $ Comparing | In this, statement is not possible to compare with last year or any business statement. | In this, statement is possible to compare with last year or any business statement. |
| $6.$ Objective | To prepare this statement the objective is not find capital and profit-loss. | To prepare this statement the objective is to know the financial position of business. |
| $7.$ Information | In this statement, the information about the financial position of business may not be complete. | In this statement, the information or particulars are complete. |
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| $1$ | Cash purchase $Rs.15,000$ and cash sales $Rs.14,000.$ |
| $2$ | A personal goods of $Rs.10,000$, brought to business. |
| $3$ | Goods of Rs.$12,000$ purchased from Harsh. |