Please Explain

friends (E) (87 Points)

24 June 2010  

 

Please Explain

1-      What is Capital?

2-      What is paid up capital?

3-      What is the meaning of Capital a/c in Balance sheet(liabilities)

E.g. XYZ Company has two partners, where the capital is 21 lakhs, both are 50%-50% partner.

X has invested 2lakhs initially and Y has invested 0.00,  X is a active partner and Y is inactive, but now X has a capital 9 lakhs, and Y has 12 lakhs,

In short: Company has Fixed Asset 10 Lakhs, and Receivables 50 Lakhs, and payable 45 lakhs,

Now X want to remove Y, but Y demanding 12 lakhs, stating that he has a capital balance 12 lakhs,

Can u explained how X will come out from this.  is he/company is liable to pay 12 lakhs to Y?   

Regards