Accounts

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Querist : Anonymous

Querist : Anonymous (Querist)

10 April 2012 Hello,

profit earned should be added to cash while calculating net current assets???

Thanks

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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10 April 2012 Profit earned is automatically represented by any of the assets so it need not be added separately as profit earned shall be taken in the reserves & surplus on liability side and on the assets side it is mixed with either stock in trade or debtors or bank balances or cash in hand or any other current assets.

CA Kishore Tallam

CA Kishore Tallam (Expert)
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10 April 2012 Agree with expert.

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Guest (Expert)

11 April 2012 Agreed. In the double entry system of accounting you need not add the profit separately to cash as it is already added to various current assets in the usual course of business.