Where there are no proper books of account , the capital at the commencement of a period is ascertained by preparing
Answer Details
When proper books of account are not available, the capital at the beginning of a period can be ascertained by preparing a Statement of Affairs. The Statement of Affairs is a statement that shows the value of the assets and liabilities of a business at a particular point in time. In this case, the statement would show the assets that the business has at the beginning of the period, such as cash, stock, debtors, etc., and the liabilities it owes, such as creditors, loans, etc. The difference between the total assets and total liabilities is the capital of the business at the beginning of the period.