Class 12 DK Goel Solutions: Financial Statements of Companies

Commerce

Class 12 DK Goel Solutions: Financial Statements of Companies

Free Download for Class 12 DK Goel Solutions Available on Vedantu

DK Goel Accountancy Class 12 Volume 2 Chapter 1 solutions are the most effective learning material for commerce students. The students regard DK Goel solutions as the best way to prepare for any examination. The solutions included in the DK Goel Accountancy Class 12 Volume 2 Chapter 1 Financial Statement of Companies are presented in a concise and detailed manner. The Financial Statement of Companies Class 12 is a chapter of prime importance in any examination, and such a to-the-point note will be helpful in this regard.

Overview of Class 12 Chapter 1- Financial Statement of Companies

Most general textbooks cover a lot of topics without proper distribution of weightage amongst them. To ensure that the students understand every topic to the fullest, the DK Goel Class 12 solutions Volume 2 Chapter 1 has been written down in easy language. The students will be able to learn and practice the problems, as discussed in the Class 12 Chapter 1- Financial Statement of Companies

What is the Financial Statement?

Financial statements are statements that reflect the financial position of the company at the end of the accounting period. It contains the details of the accounting process and evaluation. It is best defined in the Companies Act, 2013, Section 2 (40). The important parts of a financial statement are notes to accounts, position statement or balance sheet, cash flow statement, income statement, statement of profit, and statement of loss.

What is a Balance Sheet?

The balance sheet is prepared to represent the company’s financial position at any date. It contains the details of liabilities, assets, and equities of the business. Any balance sheet is prepared as prescribed in the norms of the Companies Act, 2013 ( Part I of Schedule III). However, Schedule III only mentions the vertical format of the presentation of the financial statements. The companies, on the other hand, also have the option of presenting it horizontally.

Assets: Assets are resources of past events that can extract economic benefits for the company in the future. Example- Stock, Loose tools, Buildings, Plant and Machinery etc.
Liabilities: Liability is considered as an obligation of the present that arises from any past event. The settlement of liability can result in an outflow of resources from the company. Example- Creditors, Expenses, Bank Loans, Partner Salary or Drawings etc.
Equity: Equity is the interest of the company in the assets that remains after deducting all the liabilities. Example- Retained earning, additional paid-up capital etc.

How to Refer DK Goel Solutions For Class 12 Volume 2 Chapter 1 for Better Score?

Read all the concepts carefully. Provide equal weightage for all the concepts.
Understand the link between all these concepts.
Understand the application of all the concepts mentioned in DK Goel class 12 solutions volume 2 chapter 1.
Look into different kinds of problems related to financial statements of companies class 12.
Practice all kinds of problems, mentioned in the DK Goel accountancy class 12 volume 2 chapter 1 financial statement of companies.

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Conclusion

If you want to study Financial Statement of Companies, Class 12 Accountancy DK Goel solutions are the best option in your hand. Go through different concepts of the chapter to have a clear understanding. Also, practice the various accountancy problems mentioned in the solution set, as it mostly covers all kinds of examinations. Therefore, you must practice a handful of problems every day to succeed in your exams. Remember, there are no shortcuts to success.

FAQs on Class 12 DK Goel Solutions: Financial Statements of Companies

1. Why is it important to study the chapter relating to Financial Statements?

It is extremely important to study this chapter because Financial Statements are the pillars on which Accountancy stands strong. It is very important to know every concept about Financial Statements to analyse the financial health of a business. Made at the end of each financial year i.e. 31st March, it reflects the profits made, losses incurred, total creditors, total debtors, the number of debts turned bad, total investments and total expenses. It helps the businessman plan his next financial year accordingly.

2. Who can derive benefit out of the Financial Statements of the Company?

All the parties or categories of people having an interest in a particular business can derive benefit from the Financial Statements published by the Company. Investors can decide whether they want to invest in that business or not, Shareholders can decide whether to retain, sale or purchase the shares of that Company, Clients or customers can decide whether or not to trade with the Company, and the Government can check whether the Company is in good financial health or is soon going to render losses to the common people who have invested heavily in the Company.

3. How are Financial Statements helpful for the Internal management of the Company?

A look at the annual financial statements will tell a lot about the Company, its strengths, weaknesses, opportunities that are still untapped and the divisions which are just demanding money without giving out any returns. This can be used as a tool to do the S.W.O.T (Strengths, Weaknesses, Opportunities, and Threats) Analysis of a business. The management can use this information to plan the future course of action, with regards to profit maximization, loss minimization, product diversification, distribution of dividends, issuance of shares, cost-cutting, investments and return on these investments etc.

4. How to study the theory with the help of Vedantu?

We can understand how difficult it can be to mug up theories and concepts especially for a practical subject like Accounts. That is why we believe that these concepts should be explained in detail so that they are imprinted on students’ minds for a long time. Our mentors have curated easy, fun and interesting videos explaining these concepts in detail. You can watch them as many times as you want and ask your doubts in the comments section of the video. If you wish to interact one on one with the mentor, you can also look up the schedule for that particular mentor’s masterclass and log into the session or you can also subscribe to our custom plans made just for you! Vedantu provides free access to chapter wise solutions to help students make the most of their time.

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