why capital is shown on the liability side of balance sheet .
sumit
(Self Employed with GST Working)
(57 Points)
Replied 01 July 2014
sumit
(Self Employed with GST Working)
(57 Points)
Replied 01 July 2014
DKSH,
Capital is on the Liability side as per the Accounting Entity Concept/Separate Entity Concept
Malhaar V Kale
(Chartered Accountant)
(86 Points)
Replied 04 July 2014
As Sumit said above, the person lending money as capital and entity utilising such money are two different persons. It is an obligation on the part of the entity. Hence it is considered as Liability.
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