Based on ISTD MBA Accounting Solution and others
Answer:
Trading A/c is prepared to ascertain the Gross Profit. Gross Profit is difference between net sales and cost of goods sold. A specimen of Trading Account is given below:
However, Gross Profit is the balancing figure, in case debit side total exceeds the credit side, then balance will be Gross Loss, it is shown on credit side of Trading A/c as „By Gross Loss‟.
