Q.Explain the objectives of financial accounting.

Financial accounting exists to record transactions, find profit/loss, and show financial position.

The objectives of financial accounting (studied alongside cost accounting for contrast in the +2 syllabus) are:

1. Systematic recording of all monetary transactions in the books of account (journal, ledger) so that a permanent, reliable record exists.
2. Ascertaining profit or loss of the business for an accounting period through the Trading and Profit & Loss Account.
3. Showing the financial position of the business at a point of time through the Balance Sheet (assets, liabilities, capital). …