What is the meaning of deficiency of capital? How it comes?
Dear Student,
Deficiency of Capital : When Capital account of a Partner shows Debit balance due to accumulated losses, drawings , fictitious assets etc. is known as Deficiency of Capital.
And point number (b) and (c) state that amount realised first applied to settle partners' loan and after that amount paid to partners for payment of their capitals.
Regards
Deficiency of Capital : When Capital account of a Partner shows Debit balance due to accumulated losses, drawings , fictitious assets etc. is known as Deficiency of Capital.
And point number (b) and (c) state that amount realised first applied to settle partners' loan and after that amount paid to partners for payment of their capitals.
Regards