Treatment of workman comnpensation fund
Answers
Answer:
The correct answer of this question is an external liability and the balance of amount left, if any, is an internal liability payable to partners.
Explanation:
Given - Treatment of workman comnpensation fund.
To Find - Write about treatment of workman comnpensation fund.
To Realisation, the Workmen Compensation Reserve A/C is deducted. The treatment of the workman compensation fund is applied to the capital/current account of the partner.
It's possible that a claim will arise, but it's also possible that it won't. It also implies that the claim may exceed the amount of the reserve. The Treatment of Workmen Compensation Reserve, which represents compensation due to employees, is an external responsibility, while any remaining balance, if any, is an internal liability due to partners.
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