After studying this chapter you should be able to:
Understand “profits/losses prior to incorporation”.
Treat profits and losses prior to incorporation in the books of accounts of a company.
Ascertain profit or loss prior to incorporation by applying various methods.
Understand the different “ratios” used in ascertaining profit prior to incorporation.
Apportion various expenses and incomes between pre- and post-incorporation periods using different bases.
Allocate certain expenses wholly to pre- or post-incorporation periods directly.
Prepare profit and loss account and balance sheet in addition to the statement of profit/ loss prior to and after incorporation.
Appreciate and comply ...