Question: Is workmen compensation reserve included in Realisation account?

Is workmen compensation reserve liability or asset?

The Treatment of Workmen Compensation Reserve represented by compensation payable to workers is an external liability and the balance of amount left, if any, is an internal liability payable to partners.

Does reserve come into Realisation account?

Yes contingency reserve is not transferred to realization account and all other reserves are transferred to realization account.

Is workmen compensation claim shown in balance sheet?

Workmen Compensation reserves are having a credit balance and appear in the Balance Sheet on the liability side of the Balance Sheet. Sometimes, the firm creates workmen compensation reserves are created from divisible profits of the business for meeting the liability of workmen compensation to arise in the future.

What do you mean by workmen compensation fund?

An Act to provide for the payment by certain classes of employers to their workmen of compensation for injury by accident. WHEREAS it is expedient to provide for the payment by certain. classes of employers to their workmen of compensation for injury by.

Which account is not transferred to Realisation?

Answer: Unrecorded asset are those which do not appear in the books of the firm, that’s why they are not transferred to the debit side of Realisation Account. But these assets bring certain amount of cash if disposed at the time of dissolution of partnership firm.

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What all comes under Realisation account?

1] Realisation Account

Transferring all the liabilities except Partner’s Loan Account and Partners’ Capital Accounts to the credit side of the account. Crediting the Receipt on the sale of assets to the account. Debiting the payment of Liabilities to the account. Debiting the dissolution expenses of the firm.

What type of account is realization account?

Realisation Account is a nominal account which is prepared at the time of dissolution of firm. Realisation account is prepared It is prepared to realize the various assets and pay off the liabilities.

What is general reserve and capital reserve?

General reserve is an appropriation of profits that is created without any specific purpose for meeting general future finance needs of the entity. Capital reserve is an accumulation of profits generated from capital transactions that can be utilized for financing capital purposes.

Is Workmen Compensation fund distributed among partners?

Yes it will distributed between partners if there is no claim on it.