Question

The capital which is not disclosed in the balance sheet. Answer in a word / phrase / term.

Answer 1

RESERVE CAPITAL ........✓✓✓✓✓✓✓

Answer 2

Answer:

Secret Reserve

Explanation:

The capital which is not disclosed in the balance sheet is the secret reserve.

A secret reserve is the quantity that underestimates an organization's assets or overestimates its liabilities. For competitive purposes, an organization could create a secret reserve to hide from other companies that it is in a stronger economic situation than its financial statements.

The Balance sheet does not display a secret reserve. The term secret reserve refers to a reserve of which the Balance Sheet does not reveal the existence. It can be said that there is an asset surplus over liabilities and that the balance sheet does not disclose or display the excess.