Workmen compensation fund is not an outside liability. true or false
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Answer:
True
Explanation:
Because it has been created out of profit to give compensation to the workers.
Answered by
1
This statement is true that workmen compensation fund is not an outside liability.
- Outside Liability means the liability which firm owes to the people who are not involved in the business.
- Workmen Compensation Fund is made by firm to provide any financial assistance to the workers .
- This is provided to workers who work in the organisation.
- For example if any worker is injured this fund will be used for that any worker will not be liable to pay anything to the organisation.
- If any liability is not there in an financial year against workmen compensation reserve then it is distributed to old partners in their old profit sharing ratio.
- If any kind of liability is there against workmen compensation reserve then after deducting that amount rest amount will be distributed to old partners in their old profit sharing ratio.
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