Practicing Success
Practicing Success
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In a situation where the opening capitals of partners are not given, how are the opening capitals determined before calculating interest on capital? |
The opening capitals are assumed to be equal for all partners. The opening capitals are calculated based on the partners' closing capitals, considering necessary adjustments for additions, withdrawals, drawings, and share of profit or loss shown in the capital accounts. The opening capitals are not necessary for calculating interest on capital The opening capitals are determined by dividing the total capital by the number of partners. |
The opening capitals are calculated based on the partners' closing capitals, considering necessary adjustments for additions, withdrawals, drawings, and share of profit or loss shown in the capital accounts. |
Interest can be calculated on the opening capital. That's why the opening capitals are calculated based on the partners' closing capitals, considering necessary adjustments for additions, withdrawals, drawings, and share of profit or loss shown in the capital accounts. |
