'reserve is not a liability in the real sense' Do you agree? Give reason!
Yes! Reserves are not an actual liability of the business. These are created out of profits to meet any contingent liability and to avoid any major change in the proprietor's business (in the event of occurrence of sudden liability). These reserves are profits which are owed by the business to the owners, therefore, shown on the Liabilities Side of the Balance Sheet.
Hope this answers your query.
Keep posting!!
Hope this answers your query.
Keep posting!!