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Books of Accounts and Financial Statements
Books of accounts and financial statements are two different concepts in accounting.
A books of account refer to the records maintained by a company or business to keep track of its financial transactions. These include records of all the financial transactions made by the business, such as sales and purchases, expenses, receipts, payments, etc. The books of accounts serve as the basis for preparing the financial statement.
On the other hand, financial statements are the final output of the accounting process that summarizes the financial performance and position of a business. The financial statement include the income statement, balance sheet, and cash flow statement. These statements are prepared using the information recorded in the books of accounts.
In summary, books of account are the source documents that contain the detailed records of all financial transactions, while financial statements are the summary reports that provide an overview of the company’s financial performance and position.
For more information, visit this site: https://www.incometax.gov.in/
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