Advanced accounting

Kindly help.

Hello,

I am in confusion regarding some questions of chapter 3 (advanced Accounting)... In question no 5 pg no 3.10 of study material, while calculating the capital ratio the general reserve is not added to the capital of partners whereas in Q 6 pg no 3.14 both the reserves i.e. general and capital reserves are added to the capital of partners for calculating capital ratio.

There are 2 doubts

1. Why didn't they add general reserve in Q.5

2. Do capital reserves are also added in capital of partners for calculating Capital ratio.

I would appreciate and be glad if quick and correct reply is received.

Thank you.

Replies (6)
Pages no and question no are wrong there is nothing like that in study material check out properly
I did not find in Study Material may be you are asking from practice Manual
While calculating Capital ratii U have to consider GR and CR.Check the question and calculation properly. and partners with debit balance are not called upon for bearing deficincy...
I am extremely sorry... It's from practice manual Q. No. 6, Partners' name are A, B, C & D. If you have old PM then the pg no. is 3.10. Where they didn't add general reserve in capital of partners for calculating capital ratio. Thank you.
Ok found dat prob. Jus Assume that its based on Fixed Capitals .....
Cool ! Thanks for your valuable time... Much appreciated !
@ Ayesha @ Aditya patil why this assumption in case insolvency it's two thing fixed capital and fluctuating capital that is fixed capital and current account balances if any there is no where in this insolvency u divide reserves into capital account to find capital ratio gets ur concepts clear

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