I have searched and seen several questions and answers on this topic, but a doubt remains:
How to make assets / liab NIL? After all a co. has share capital which has to be represented by Cash or Bank balance. How to make it perfect zero? It may also have Retained Profits, again represented by cash or Bank if it was not a loss making co.
Should the profits be paid off as dividend? Even then share capital would remain? Is Bank balance considered asset? For that matter Cash is also asset right?
Any reply would be appreciated.
I wonder why the babus that thought up this scheme did not see it fit to clarify these things to help everyone.
CAclubindia
