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Change of firm from proprietorship to partnership

kishore (Assistant Manager- Accounts) (59 Points)

05 April 2017

Sir, Can you please confirm the treatment of Capital Account Balance as we have change the status of firm from Proprietorship to Partnership. What should we do if we are not able to return the balance of capital account to proprietor.

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4 Replies

CA Tanvi Sheth (Consultant) (232 Points)
Replied 05 April 2017

You can show it as capital introduced by that partner( if the proprietor is in the existing firm)

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kishore (Assistant Manager- Accounts) (59 Points)
Replied 05 April 2017

Thanks for your reply, but if we don't want to introduce full amount of proprietor capital as partner capital than where balance amount would be transfer. If I am not wrong can we show the balance amount as loan from partner.

Dixit (CA Final) (2405 Points)
Replied 07 April 2017

Originally posted by : kishore
	Thanks for your reply, but if we don't want to introduce full amount of proprietor capital as partner capital than where balance amount would be transfer. If I am not wrong can we show the balance amount as loan from partner.