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Capital is asset of the company. But why does it appear in
Liability side of the balance sheet.
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Answer / raunak bhadani
as owner and business is distinct entity and capital is
been invested by the owner for the business, so its the
responsibility of business to return back the capital to
there owner,so,its liability for the business.
| Is This Answer Correct ? | 0 Yes | 0 No |
Answer / ali
Capital is not a liability nor its an asset. It is shown
under owners equity section of the balance sheet. Also
capital will be in the form of say, cash or building and
they will be on the asset side therefore under double entry
concept the other side will be credit. If you dont believe
me then go to any public company web site and take a look at
their balance sheet. By the way net profit is also not a
liability its shown as retained earning on the equity section.
| Is This Answer Correct ? | 0 Yes | 0 No |
Answer / shreeram
balance sheet is shown exact financial position of the
company, capital are invested by owners of the company,
according to acconting principle ,owners and business are
separate entities(business entity concept), that is the
reason it's shown in liabilities side because its payable
after maturity period
| Is This Answer Correct ? | 0 Yes | 0 No |
Answer / kate
Capital is neither an asset nor a liability from the
"accounting" point of view. It is the difference between
assets and liabilities. It's written on liability side NOT
BECAUSE it's a liability, BUT because sum of liabilities and
capital should be equal to assets. You could write it
wherever you liked (but for existing rules) which wouldn't
change the formula. It makes visual perception of what is
called BALANCE clear.
| Is This Answer Correct ? | 0 Yes | 0 No |
Answer / rahul kanojiya
share capital is the liability of the company .
it means that the shareholders are holding the share of
the company .
| Is This Answer Correct ? | 0 Yes | 0 No |
Answer / dharmendar singh rawat
CAPITAL IS NOT AT ALL ASSTE ITS A LIABILITY, THE QUESTION
IS WRONG.............
capital is a company liability
| Is This Answer Correct ? | 0 Yes | 2 No |
Answer / rahul gandhi
IF I am a Founder of Co. & I had intially invested 1 Lac
Rs. & then after certain years Turnover cross 1 Crores but
then my intial investment with the co. now if co. presently
became Ltd. co. & now any kind of share holder investment
is an assets, but my intial cont.for co. is a liability
which i can claim or as per co.law we can put provision for
this capital so its shown atliability side in B/S.
| Is This Answer Correct ? | 2 Yes | 5 No |
Answer / siddu
CAPITAL IS NOT AT ALL ASSTE ITS A LIABILITY, THE QUESTION
IS WRONG.............
.......S.B.M
| Is This Answer Correct ? | 0 Yes | 4 No |
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