Dear Sir
after death of proprietor capital account value transfer to his both sons 31.03.21 please suggest in busy which group we create the ledger proprieto,s both sons
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Entry in books after death of proprietor
Replies (15)
Quick Summary
Pass entry if capital of old proprietor transfer to both the son's in proportionate or as per agreement , So same capital brought in the business buy both the son's .
Proprietor s Capital A/c Dr
To Son A Capital A/c Cr
To Son B capital A/c Cr
( Being old proprietor capital account transfer to both son )
Both the son's Capital account will be under Capital account , liability side , Balance sheet.
Proprietor s Capital A/c Dr
To Son A Capital A/c Cr
To Son B capital A/c Cr
( Being old proprietor capital account transfer to both son )
Both the son's Capital account will be under Capital account , liability side , Balance sheet.
Sir, In Proprietor ship 2 Capital account it's correct.
Only one can become proprietor .
I thought you are converting Sole proprietorship in to partnership firm .
No, Sir No Partnership firm Only Proprietor ship
If both the son's have taken over business then , it's partnership only .
Or only one can become proprietor and you can pass capital transfer entry .
Sir, in 01.04.2021 current financial year same firm transfered to big son he is the Proprietor of firm we can creat the ledger under capital account so please suggest for Group for second son
He will not be the part of Business , if sole proprietorship firm . So how we can create ledger account of his name ?.
If second son want to be the part of business then , they can convert in partnership Firm .
Sir, Second Son don't want to part of business.He taken his amount by cheque in current financial year.
If amount withdrawn from Business to pay younger son by the proprietor ( elder Son ) , then you have to show as drawings . so in my opinion you do not create ledger of his younger son , instead you have to create ledger as drawings , later on will be debited to proprietors capital account.
whatever amount withdrawn from business as drawings will be paid to younger son .
whatever amount withdrawn from business as drawings will be paid to younger son .
Thank you very much Sir,
Welcome .
Actually I confused when I first read your query I thought you converting sole proprietorship in to partnership firm , any way it's ok now .
Actually I confused when I first read your query I thought you converting sole proprietorship in to partnership firm , any way it's ok now .
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