Q.The Trading Account is prepared to find out:
(A) Net Profit or Net Loss
(B) Gross Profit or Gross Loss
(C) The financial position of the business
(D) The balance of Capital Account

The Trading Account deals only with buying/selling goods and direct expenses — that scope produces Gross Profit, not the overall Net Profit.

Match each option to what each statement is actually designed to compute.

The Trading Account matches sales and closing stock against opening stock, purchases, and direct expenses to compute the profit purely from trading activity.

Option-by-option analysis:

• (A) Incorrect — Net Profit is computed by the Profit and Loss Account, not the Trading Account.
• (B) Correct — this is exactly the Trading Account's purpose.
• (C) Incorrect — financial position is shown by the Balance Sheet.
• (D) Incorrect — the Capital Account balance is affected by Net Profit, computed later, not directly by the Trading Account.