Nil business
This query is : Resolved
03 October 2012
Dear Friends
Whether it can possible that a Pvt. Ltd. co. have Zero business since last 6-7 years and B/Sheet shows Liabilities:- Share Capital Rs. 100000/= Assets ;- Cash Rs. 3000/= Current Liabilities Rs. 30000/= i.e. net current assets Rs. (27000) and Accumulated Net loss Rs. 127000/=. There is no other items in B/Sheet No Bank A/c.
My question is Capital Balance of 100000/= is adjusted with accumulated net loss in Assets side.
Pl. advise.
Whether it can possible that a Pvt. Ltd. co. have Zero business since last 6-7 years and B/Sheet shows Liabilities:- Share Capital Rs. 100000/= Assets ;- Cash Rs. 3000/= Current Liabilities Rs. 30000/= i.e. net current assets Rs. (27000) and Accumulated Net loss Rs. 127000/=. There is no other items in B/Sheet No Bank A/c.
My question is Capital Balance of 100000/= is adjusted with accumulated net loss in Assets side.
Pl. advise.
03 October 2012
as per rev./ sch 6 -Debit balance of Profit and Loss Account to be shown as negative figure under the head Surplus. Therefore, reserve & surplus balance can be negative.
NOT SHARE CAPITAL, SO
LIABILITIES SIDE
S/C 100000
R & S -127000
CL 30000
TOTAL 3000
ASSET SIDE
CASH 3000
TOTAL 3000
NOT SHARE CAPITAL, SO
LIABILITIES SIDE
S/C 100000
R & S -127000
CL 30000
TOTAL 3000
ASSET SIDE
CASH 3000
TOTAL 3000
03 October 2012
Thanks friend
But new form is not taking negative balance of Res & Surplus. Is it possible that this B/Sheet of Rs. 3000/= both side. Where the amount of Share Capital of Rs. 100000/= goes. In this case it goes in accumulated loss. Advise
But new form is not taking negative balance of Res & Surplus. Is it possible that this B/Sheet of Rs. 3000/= both side. Where the amount of Share Capital of Rs. 100000/= goes. In this case it goes in accumulated loss. Advise
03 October 2012
as per rev. sch 6 R& S( acc. losses) should be shown as negative in liabilities side.. accordingly b/s total will be 3000 in both side
03 October 2012
set off against share capital not allowed.
03 October 2012
Negative figure in R&S a/c is not accepting.
I m writing figure as -127000 but is not accepting. Pl.advise
I m writing figure as -127000 but is not accepting. Pl.advise
03 October 2012
why it is not accepting, there is clear guidance on this matter that accumulated losses figure should be shown in liabilities side as negative........
03 October 2012
Sir I have try it several times. Have you try to feed negative figure. Pl. try and also advise us because in this forum others have the same query.
Thanks
Thanks
04 August 2024
It sounds like you're facing issues with how to represent the financial position of your Pvt. Ltd. company accurately, especially regarding the accumulated losses and the Share Capital in the Balance Sheet. Let me clarify the key points and provide guidance:
### Understanding the Balance Sheet Components:
1. **Assets and Liabilities:**
- **Assets:** You've mentioned Cash of Rs. 3,000.
- **Liabilities:** Current Liabilities of Rs. 30,000, resulting in a net current asset deficit of Rs. (27,000).
2. **Accumulated Net Loss:**
- Your company has an Accumulated Net Loss of Rs. 127,000, which indicates that your total liabilities exceed your total assets by this amount.
3. **Share Capital:**
- The Share Capital of Rs. 100,000 represents the funds contributed by shareholders to the company. In the context of your Balance Sheet, it seems you're questioning where this Share Capital should be reflected.
### Treatment of Share Capital and Accumulated Loss:
- In a Balance Sheet, Share Capital is typically shown under the Equity section (Shareholders' Funds) on the Liabilities side.
- Accumulated Losses, which indicate a deficit in the company's profitability over its history, are deducted from the Shareholders' Funds.
### Issues with Negative Reserves and Surplus:
- The issue you're encountering with the new form not accepting negative figures in the Reserves and Surplus (R&S) account is likely due to the format restrictions or validation rules of the form.
### How to Address the Issue:
1. **Proper Representation:**
- Ensure that in your Balance Sheet:
- **Liabilities Side:** Reflect Share Capital as Rs. 100,000.
- **Assets Side:** Reflect Cash as Rs. 3,000.
- **Net Worth (Equity):** Deduct the Accumulated Losses of Rs. 127,000 from the Share Capital to show the Net Worth.
2. **Reporting Format:**
- Check the guidelines or instructions provided with the form regarding how to report negative figures. Sometimes, forms require you to enter negative figures differently (e.g., in brackets, or with a minus sign).
3. **Documentation:**
- Clearly document the reasons for the accumulated losses and how the Share Capital has been adjusted against these losses.
4. **Seek Professional Assistance:**
- If you're still facing difficulties, consider consulting a professional accountant or tax advisor who can guide you through the correct reporting procedures and help resolve any technical issues with the form.
### Conclusion:
Ensure that your Balance Sheet accurately reflects the financial position of your Pvt. Ltd. company, with Share Capital properly adjusted against accumulated losses. If the form does not accept negative figures directly, follow the formatting instructions provided, or seek assistance from a professional to ensure compliance and accuracy in reporting. This approach will help you present a clear financial picture to regulatory authorities and stakeholders.
### Understanding the Balance Sheet Components:
1. **Assets and Liabilities:**
- **Assets:** You've mentioned Cash of Rs. 3,000.
- **Liabilities:** Current Liabilities of Rs. 30,000, resulting in a net current asset deficit of Rs. (27,000).
2. **Accumulated Net Loss:**
- Your company has an Accumulated Net Loss of Rs. 127,000, which indicates that your total liabilities exceed your total assets by this amount.
3. **Share Capital:**
- The Share Capital of Rs. 100,000 represents the funds contributed by shareholders to the company. In the context of your Balance Sheet, it seems you're questioning where this Share Capital should be reflected.
### Treatment of Share Capital and Accumulated Loss:
- In a Balance Sheet, Share Capital is typically shown under the Equity section (Shareholders' Funds) on the Liabilities side.
- Accumulated Losses, which indicate a deficit in the company's profitability over its history, are deducted from the Shareholders' Funds.
### Issues with Negative Reserves and Surplus:
- The issue you're encountering with the new form not accepting negative figures in the Reserves and Surplus (R&S) account is likely due to the format restrictions or validation rules of the form.
### How to Address the Issue:
1. **Proper Representation:**
- Ensure that in your Balance Sheet:
- **Liabilities Side:** Reflect Share Capital as Rs. 100,000.
- **Assets Side:** Reflect Cash as Rs. 3,000.
- **Net Worth (Equity):** Deduct the Accumulated Losses of Rs. 127,000 from the Share Capital to show the Net Worth.
2. **Reporting Format:**
- Check the guidelines or instructions provided with the form regarding how to report negative figures. Sometimes, forms require you to enter negative figures differently (e.g., in brackets, or with a minus sign).
3. **Documentation:**
- Clearly document the reasons for the accumulated losses and how the Share Capital has been adjusted against these losses.
4. **Seek Professional Assistance:**
- If you're still facing difficulties, consider consulting a professional accountant or tax advisor who can guide you through the correct reporting procedures and help resolve any technical issues with the form.
### Conclusion:
Ensure that your Balance Sheet accurately reflects the financial position of your Pvt. Ltd. company, with Share Capital properly adjusted against accumulated losses. If the form does not accept negative figures directly, follow the formatting instructions provided, or seek assistance from a professional to ensure compliance and accuracy in reporting. This approach will help you present a clear financial picture to regulatory authorities and stakeholders.
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