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Hello Everyone,
I have run a propriter business from last 3 years & capital bal on 31.03.2010 is Rs. 200000 and during the period 10-11 i had suffred business loss of 500000 due to which reason my capital bal. gone negative and i had take unsecured loan for running the business so, my capital bal. on 31.03.2011 is Rs. -300000. and after that i unable to run business in sole proprietorship hence, i decide to merge with a partnership business, all assets and liabilities are takeover by partnership firm on 01.04.2011 and i had also partners in new firm, then what will be accounting treatment of my negative capital bal. in the books of firm as well as in books of propriter , while capital introduced by me in partnership firm is rs. 40000.
Plz explin me accounting treatment of above adjustment by Journal Entry. |
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