Given an incomplete record without sufficient information to determine profit, the necessary thing to do is to?
Answer Details
When faced with an incomplete record without sufficient information to determine profit, the necessary thing to do is to draw up the statement of affairs.
A statement of affairs is a document that shows the assets and liabilities of a business at a particular point in time. It lists all the assets and their corresponding values on one side and all the liabilities and their corresponding amounts on the other side. The difference between the total assets and the total liabilities is the net worth of the business.
Drawing up a statement of affairs is necessary because it helps to provide a snapshot of the financial position of the business at a particular point in time, even in the absence of complete records. This statement can then be used to determine the financial health of the business and to identify any areas of concern that need to be addressed.
The other options listed in the question (drawing up a T-account to establish the amount, comparing the journal entries with the cash book, and cross-checking the cash book for further information) may be useful in certain circumstances, but they do not provide a comprehensive view of the financial position of the business. Therefore, drawing up a statement of affairs is the necessary thing to do when faced with an incomplete record without sufficient information to determine profit.