Final Accounts of Companies — Part 2: Notes to Accounts and the Balance Sheet from a Trial Balance: visual lesson, ISC Class 12 Accounts

Lesson

Notes to Accounts and the Balance Sheet from a Trial Balance

Part 2 — the notes behind each figure, the adjustments and the profit working, and a complete Balance Sheet from a trial balance.

In this lesson you will

Prepare the notes on Share Capital, Reserves and Surplus, Borrowings and Property, Plant and Equipment
Work out the profit for the year from a given profit and the adjustments, and carry it to the surplus
Show current maturities of long-term borrowings under Short-term Borrowings and a proposed dividend as a contingent liability
Prepare the Balance Sheet of a company from a trial balance with adjustments

Part 2 at a glance

Concept

The face of the Balance Sheet shows one figure per sub-head; the note shows how it is made up.

How notes and the Balance Sheet fit together

Concept

Only subscribed capital is added; authorised and issued capital are information.

Table of the share capital note: authorised and issued capital shown for information only; subscribed and fully paid capital, subscribed but not fully paid capital net of calls in arrears, and forfeited shares not reissued are added to the total
Line of the note	What it shows	Added to the total?
Authorised capital	Shares the company may issue (memorandum)	No
Issued capital	Shares offered to the public	No
Subscribed and fully paid	Shares taken up and fully paid	Yes
Subscribed but not fully paid	Amount called up, less calls in arrears	Yes (net)
Add: Forfeited shares	Amount received on forfeited shares not yet reissued	Yes