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BASED ON PRACTICAL TRAINING By RAKESH C. GUPTA & CO. Submitted for partial fulfillment of B.com 2nd(professional) degree in the Deptt. Of Commerce GURU NANAK DEV UNIVERSITY, AMRITSAR SESSION (2008-2009)
Submitted To: Prepared By:

GEETA MONEY (Deptt. Of Commerce)

GURVINDER SINGH B. Com(p) 2nd College Roll No:Uni. Roll No:-

Submitted through the principal: Saint Soldier College,Hadiabad Phagwara.

ACKNOWLEDGEMENT

It gives me great pleasure in acknowledging the invaluable assistance extended to me by various personalities in the successful completion of this training report rate are the component in indefatigable lectures and guides, who bestow their fortunes upon students, particular in research field. World are often weak to express ones inner feeling, especially the sense of indebtedness. My thinking faculty fails to find appropriate words to express my deepest gratitude to my revered teacher and guide Kapil Maini, Head of Commerce department and business management, Saint Soldier College, Phagwara who rendered me all possible help, continues motivation, encouragement and timely guidance in completing term paper. I feel extremely pleased to avail the opportunity of expressing my heartiest and sincere thanks to my learned teachers who permitted me for joining training, Kapil Maini and ICIC PRUDENTIAL CO. who help very much. I am also thankful to others staff members who extended me theyre full supported to me. Above all, I owe a debt of gratitude to my parents, teacher and friends for their encouragement the co-operation at different times. The inspiration from them becomes the light on the way to the completion of this training report.

VISHVJEET SINGH

CONTENTS
Chapter 1. Chapter 2. Chapter 3. Chapter 4. Chapter 5. Chapter 6. Introduction Objectives of study Theoretical detail about study Practical Aspects Suggestions & Recommendations Bibliography

INTRODUCTION TO FINAL ACCOUNTS OF SOLE TRADER

Sole trader organization also called individual proprietorship, soleproprietorship and single entrepreneurship is oldest form of organization. It is as old as civilization. Historically, it appears that business first started with this form of organization. It found in every started with this form of organization. It is found every country of the world. A sole trader makes his own investments an bears all the risks. A sole trader is a sole organizer of the business and looks after every activity of the enterprise. He is the finance manager, production manager, marketing manager, accounts manager etc. of the business. He takes all decisions himself. It is a short of a family business where other members may lend a helping hands. A sole trader may employ servants for his help but decision making and risk taking remains with the owner. So, it is a one man business or a single ownership business. The success or failure depends upon the intelligence, social, competency and decision making capacity of the sole trader. The role of accounting has been changing keeping pace with economic, social and legal developments over the periods. Until recently accounting was regarded as an art of recording, classifying and summarizing (in a significant manner and in terms of money) transaction and events (which are financial in character) and interpreting the results there of. As an information system it collects and communicate information about a business enterprise or other entity to a wide variety of persons. Thus, at present, accounting is the:1) measurement and communication of financial information. 2) About economic activities of an entity to.

3) Interested persons.

OBJECTIVE OF STUDY

The main objective are given below:1) To ascertain the result of working in terms of profit and losses. 2) To a certain position of business in terms of assets and liabilities on a specific date. 3) To analysis every financial transaction of business. 4) To assessing the value of business as the time of sale of the business and insolvency of businessman. 5) To take decision regarding expansion selection of profitable product mix, diversification, dropping of a product live extra. 6) To evaluate the performance of the business. 7) To assessing tax liability of the business.

DETAIL STUDY

Definition:
According to I.H.Haney:
The individual entrepreneurship is the form of business organization on the head of which stands and individual as the one who is responsible, who directs its operations who alone runs the risk of failure.

Characteristics of sole trader business:

1) Individual ownership:- a sole trader business is owned
by one person. There are no business associates of the sole trader with whom he has to share his profits. The owner spends his own money as capital. He is not barred from arranging funds outside but these should not be a part of capital.

2) No separate entity:- a sole trader and his business are not

different entities as is the case in joint stock companies law does not separate the owner and his business. But are the same in the eyes of law.

3) Unlimited liability:- in this form of organization the

liability of the owner is unlimited. The owner is responsible for all the losses arising form the business. The liability is not limited only to his investment in the business his private property is also liable for business obligation.

4) Individual motivation:- since there are not partners or

other associates in sole trader the owner gets all the profits. There is a direct relationship between efforts and rewards. If he works more he will earn more. He will try to expand his business activities to increase his profit.

5) Link between ownership and control:- there is

no separation between ownership and control. The owner controls the business himself. He prepared various plans and executes them under his supervision. In small business ownership and control remains in the same hands while this separation possible in the large scale business.

6) Individual risk:- all the risk of sole trader business are borne
by the owner himself. Since he has no business associate he cannot share his risk with anybody else. The risk factor will always keep the owner vigilant and cautions.

7) Stability:- there is a stability in a sole trader business. Thought

the present ownership is linked to the life span of the property but normally the business passes on his son or other heirs who continues the same work.

8) Own capital:- the capital of the sole trader business is supplied

by the proprietor himself. He may arrange funds from outside source to but these will be in form of loans and not a part of capital so entire capital of sole trader business is provided by the proprietor.

SUGGESTION AND RECOMMENDATION

1. Final accounts are necessary for the sole trader itself and for every person who has interest in this business. 2. A qualified accountant can examine the financial position of sole trader. 3. No person can interfere in the sole trader business without the consent of sole trader. 4. The property and goodwill of the sole trader is to held and used exclusively for the benefit of the business. 5. Sole trader is liable for the business

BIBLIOGRAPHY
1. Chawla R.C., Garg K.C., Sareen V.K. Financial Accounting Kalyani publishers, Ludhiana.

2. Kapoor N.D. Financial Accounting Kalyani publisher, Ludhiana.