why do in balance sheet we show liabilities first nd assets thereafter,both in vertical and horizantal form??
CA. Pushkar Sharma
(Chartered Accountant)
(278 Points)
Replied 14 January 2009
look Rashmi,as far as my knowledge is concern there is no specific reason behind it BUT if the same is asked in interview you should smartly react on it, say you can answer.....
As we follow conservative approach in accontancy, we alwayes look at liabilities first.
Ameet
(L)
(1678 Points)
Replied 15 January 2009
LIABILITIES IS SOURCE OF INCOME FOR ASSETS THEREFORE IT IS FIREST IN BALANCESHEET.
Aditya Jain
(Final (New) November 2011)
(763 Points)
Replied 15 January 2009
Exactly ... First u get some money from some source say Equities or Loans and then you show where all did u use the money . I've learnt this is in my PCC Accountancy class . So there is a valid reason for it .
CAclubindia
