Liabilities Presented by Dr B N Shinde Assistant Professor Department of Commerce Deogiri College Aurangabad Classification of Assets and Liabilities Liabilities Proprietors Capital ID: 1029635
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1. Classification of Assets and LiabilitiesPresented byDr. B. N. ShindeAssistant ProfessorDepartment of CommerceDeogiri College, Aurangabad
2. Classification of Assets and LiabilitiesLiabilities Proprietors CapitalLong-term LiabilitiesCurrent Liabilities Other LiabilitiesAssetsFixed AssetsCurrent AssetsQuick or Liquid AssetsOther Assets
3. LiabilitiesProprietors Capital: Proprietors funds are those funds which is provided by proprietors (Owners).CapitalAdd : Net profitAdd: Interest on capitalLess: Net loss if anyLess: Drawings00000000000000General Reserve:It is part of profitIt is created for meeting the certain unforeseen obligations in future.
4. Continue..2. Long term Liabilities: Long term liabilities also called as fixed liabilities or term liabilities or long-term loans. They may takes various forms such as public deposits, Bank loan, differed payments etc. They may be fully secured or partly secured or unsecured.
5. Continue…Current liabilities and provisions:. Current liabilities of firm are those Short term obligations, which mature within one yearFollowing are the examples of current liabilities.Sundry creditorsBills payableInterest payableBank overdraft Outstanding expensesUnclaimed dividend
6. ProvisionsProvision means any amount retained by way of providing for any known liability of which the amount can not be determined with substantial accuracy.Provision for DepreciationProvision for taxationProvision for outstanding expensesProvision for proposed dividend
7. Quick LiabilitiesThese are the Current liabilities which mature within a very short period of time. All current liabilities except bank overdraft is called as quick liabilities.Quick liabilities = Current liabilities – Bank overdraft
8. Contingent liabilitiesLiabilities which do not exist at the time of preparing balance sheet but may become liability on happening or non-happening of certain events is called as contingents liabilities.
9. Assets:Fixed Assets: Fixed assets are those assets which intended long term use in the business.LandBuilding / PremisesPlant and MachineryTransportation equipmentsFurniture and fixturesOther long term assetsIntangible assets: Patents, trademark , Copyright, Goodwill etc.Computers and software's
10. Current AssetsCurrent assets are those assets which we convert into cash within one yearCashBank BalanceShort term investmentsSundry debtorsClosing stock or inventoryPrepared exp. Bills receivablesLoose Tools
11. Quick or liquid assetsThese assets are known as near cash assets. Liquid assets are those which can converted into cash quickly. All current assets except Stock and prepared expenses is called as liquid assets. Liquid Assets = Current Assets – Inventory + Prepared expenses.