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A partner contributed machinery as capital and the firm accepted a liability of five thousand rupees on that machinery. Agreed value of machinery is thirty thousand rupees. What is net credit to capital account?

Answer and explanation

Correct answer: Twenty five thousand rupees

Capital is credited by asset value less liability assumed. Thirty thousand minus five thousand equals twenty five thousand.

Related tags

Asset With LiabilityCapital ContributionNumericalCapital AccountsPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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