Closing balance

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nitin (Querist)
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31 May 2013 Respected Sir,
I am Nitin Verma, Sir kindly request to you explain if capital account showing debit closing balance, creditor a/c showing debit balance, debtor a/c showing credit balance what it's mean.......

Dintakurthi Tirumala

Dintakurthi Tirumala (Expert)
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31 May 2013 It means for

Capital account showing debit balance means such capital introduced person make more drawings from the firm than his share of capital from the firm and he is liable to firm.

Creditor a/c showing debit balance means you make the more payment than actual due to the creditor i.e means you paid advance payment to the creditor(excess payment to the creditor than balance due to his as per your records or books) and then creditor is liable to firm i.e creditor becomes as debtor.

Debtor a/c showing credit balance means firm received more amount from his than actual due by the debtor i.e means you received advance amount from the debtor(excess amount received from the debtor than balance due by him as per the firm's record or books) and firm is liable to debtor i.e debtor becomes as creditor.

OM SAI SRI SAI JAI JAI SAI

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