Sir, mother has recovered unsecured loan from his son, so the recovery amount along with interest will be effect whether on capital Account or Balance Sheet .Please advise.
26 June 2018
If the above loan was given for personal use, then no question of bad debts arised at the time when it was not recoverable.It was directly debited to the Capital Account. If this is the situaiton; then now Credit the recovered amount to the Capital.
26 June 2018
Sir, That means sir whole amount of loan along with Interest which has been acquired from son have to be credited in capital account of mother.
26 June 2018
Since the loan was not claimed as bad debts earlier, hence the amount which is shown as outstanding Loans, the same would be set off from the amount received. No effect on capital.
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