sheet as follows :

sheet as follows : Trading and Profit and Loss Account of Ankit for the year ended March , Cr. Expenses/Losses Revenues/Gains , , , , Add Outstanding wages ( ) , Gross Profit c/d , , , , , Salaries , Gross profit b/d , Less Prepaid salary ( , ) Rent of building , Commission received , , Add Accrued Depreciation-Furniture Commission , Net profit (transferred to , Ankit’s capital account) , , Notice that the amount of net profit declines with the adjustment of depreciation. Let us now see how depreciation as an expense will be shown in balance sheet. Balance Sheet of Ankit as at March , Liabilities Assets Owners Funds Non-Current Assets Add Profit , , Less Depreciation ( , ) , Non-Current Liabilities Current Assets Long-term loan , Current Liabilities Prepaid salary Accrued commission Outstanding wages Bank Rent received in advance Cash , ,