why capital is a liability ?

Answer Posted / libin kulamuttom

it is an amount invested by the propraitor to start a busines.As per accounting entity concept the owner and the firm has seperate entity.so it shold be treated as a loan given by him.Hence in companies point of view,it has the liability to repay the amount in future.so capital is a liability.

Is This Answer Correct ?    93 Yes 4 No



Post New Answer       View All Answers


Please Help Members By Posting Answers For Below Questions

Can you differentiate public and private accounting?

692


In which term & condition excise invoice raises & for what excise invoice raise?

985


salary and rent entry with tds deduct

1248


whether bills of exchnge can come under the category of reserves and surplus

1361


Role-specific management accountant job interview questions:

609






Do you know what are trade bills?

951


What are the steps involved in project implementation?

719


dear i want basic a\C's oriented question. these are asking in mostly all mnc companies

1523


Why Is The Distinction Between Product Costs And Period Costs Important?

653


What are mis reports and how do you prepare it?

592


what is one way , two way matching , three way , four way matching ?

1395


what is the Differed Tax Liability & How it is calculate ?

1970


A manufacturer want to sale his product in Rs 110/ where his manufacturing cost is 100.what will be tax for the product in different way.If he want to sale his product outside the state then what will be the taxation way. I want to know as urgent.Hope you will describe me as brakewise statement with example.

1515


What is the importance of accounting standards?

677


if at the end of the year cash book is showing debit balance whether it is meant that cash is not deposited after deducting expenses in bank and it is in hand and we should deposit in next year

1463