S1: In the Single Entry System, the Statement of Affairs is prepared to ascertain the profit or loss for the year. S2: The difference between the closing and opening capital in a Statement of Affairs represents the profit or loss, adjusted for drawings and additional capital. Which statement(s) is/are correct?
Explanation:
S1 is incorrect because the Statement of Affairs ascertains capital, not profit/loss directly. S2 is correct; profit/loss is derived by comparing closing and opening capital, adjusting for drawings and fresh capital introduced.
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