Final Accounts of a Sole Proprietor comprise Trading Account, Profit & Loss Account, and Balance Sheet prepared at the end of accounting period. These accounts show the financial position and performance of the sole proprietorship (non-corporate business owned by one person). Trading Account shows gross profit calculation from sales after deducting cost of goods sold. Profit & Loss Account shows net profit/loss after deducting operating expenses from gross profit. Balance Sheet (Statement of Financial Position) shows assets, liabilities, and owner's equity on a specific date. Purpose of Final Accounts: Ascertain profit or loss, determine financial position, assist in decision-making, comply with legal requirements (Income Tax, GST), provide information to stakeholders. Preparation process: Identify all transactions, prepare Trial Balance, record adjustments for accruals, prepayments, depreciation, provisions, close Trading and P&L accounts, prepare Financial Statements. Key principle: Matching Principle matches revenues with expenses incurred to generate those revenues. Accrual concept ensures transactions are recorded when they occur, not when cash moves. Going Concern assumption assumes business will continue indefinitely. These accounts form the foundation of financial reporting under Indian GAAP. Exam tip: Understand the structure and purpose of each statement; master the flow from Trial Balance to Final Accounts; know common adjustments required.