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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 Posted / 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.
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