Financial Statements of Sole Proprietorship — Account STD 11 Commerce — Question

Preparation of Trading Account is the first stage of preparing final accounts. It is the financial statement which shows result of buying and selling of goods and/ or services during an accounting period.
It is credited with sales, services rendered and closing stock or inventory. Opening stock or inventory, net purchases and other direct expenses are debited in the account. The difference in two sides is either Gross Profit or Gross Loss.