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capital is a assets but its shows in liability side. why?
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Answer / amal roy
here business and personal matter is different as per aspect
of business .business or comapny or organisation borrowed
money from people or individual . so business has
responsible to pay the borrowing . so that capital is
showing libilities site in balance sheet.
| Is This Answer Correct ? | 41 Yes | 1 No |
Answer / saurabh.jain0143
only share capital and the capital which has borrowed shows
in the LIABILITY side.
| Is This Answer Correct ? | 13 Yes | 1 No |
Answer / vijay007in
First of all capital is not an asset. its a liability of the
company. it may ( Investment)asset of the owner or share
holders. for the company point of view its liability to pay
to concern.So
| Is This Answer Correct ? | 7 Yes | 0 No |
Answer / raju.k
As per Separate entity concept. the business and
individuals are separate. So the owners investment for a
perticular business will be consider as liability for that
business.
| Is This Answer Correct ? | 5 Yes | 1 No |
Answer / madhukumar
capital is a liability to organization because we are
investing amount into the business. and we dont know whether
we'll get it back or not... soo it was been posted to
liability side
| Is This Answer Correct ? | 3 Yes | 0 No |
In my view, the business is different from individual, and
as the capital is introduced from out side so there arises
the liability for its redemption/pay back on business
closure. Although, the same capital is reflected in form of
Fixed Assets and other asset items.
| Is This Answer Correct ? | 2 Yes | 1 No |
Answer / h.r. sreepada bhagi
As per Business Entity Concept, the business unit owes
capital & reserves 9accumulated profits or retained
earnings) to the contributors like Shareholders, Partners or
Proprietors, so it's shown on the Liabilities side of teh
Balance Sheet. This is money is an asset of the contributor
and not of the business unit which has a distinct existence
from it's owners.
| Is This Answer Correct ? | 1 Yes | 0 No |
Answer / sampath
liablity side are coming Capital -Drawings,equity
shares,prefrence shares,loans,current liabiltes creditors
(Short term)
Assets Side are coming Fixed assets,Cureent Assets Detors
Cash in hand ,bank in hand ,loans&advances
| Is This Answer Correct ? | 0 Yes | 0 No |
Answer / abdul hannan
as the promoters of the co, and co. is different from each
other the amount invested by the promoters to start the
company is trated as liability, since the co. is different
from its owners it treats the funds used to start the co.
as amount borrowed or capital borrowed which has to b
repaid. so it is shown on the liability side...
| Is This Answer Correct ? | 0 Yes | 0 No |
Answer / naresh kumar
CAPITAL IS AN LIABILITY. AS IT IS AN INITIAL INVESTMENT
MADE BY THE ANY OWNER OR PARTNER IN ORDER TO RUN
ORGANISATION SMOOTH WAY.
| Is This Answer Correct ? | 0 Yes | 0 No |
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