Junior Class 1 Answered

Hi Anjali,

If the claim is less than the workmen compensation fund given in the Balance Sheet, then:

• The excess amount in the fund will be distributed among all the partner’s in old ratio; and
• The claim will appear on the liability side of the new balance sheet.

If the claim is more than the workmen compensation fund given in the Balance Sheet, then:

• The deficit amount will be debited to Revaluation Account; and
• The claim will appear on the liability side of the new balance sheet.