Question

if the retiring partner is not paid the full amount due to him immediately on retirement, how should his capital account be shown in subsequent balance sheet?

Answer 1

His Capital will be transferred to His loan A/C. For example - Mr. X retires. Firm should give him Rs 500000 but presently they are unable to Rs 500000. They give 400000. So, Rs 100000 will be transferred to Mr. X's A/C. It will appear on Liability of Balance Sheet.

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