The prescribed order for compiling the partnership firm's final accounts is detailed below:
- Trading Account (C): This account is compiled initially to ascertain the gross profit or loss by comparing sales revenue with the cost of goods sold.
- Profit and Loss Account (B): Following the determination of gross profit or loss, the subsequent step involves preparing the Profit and Loss Account to record all indirect expenses and income, ultimately yielding the net profit or loss.
- Profit and Loss Appropriation Account (A): The Profit and Loss Appropriation Account is prepared to distribute the net profit or loss among the partners according to their profit-sharing ratio, and to incorporate adjustments such as interest on capital and drawings.
- Balance Sheet (D): The final step is the preparation of the Balance Sheet, which exhibits the firm's financial standing by listing its assets and liabilities.
Therefore, the correct sequence is: (C), (B), (A), (D)