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What do you understand by ownership capital and borrowed capital? Distinguished between them??

Posted by Nagendralal Chakma 4 years, 1 month ago

CBSE > Class 11 > Business Studies

1 answers

Yogita Ingle 4 years, 1 month ago

Ownership Capital : Ownership capital consists of the amounts contributed by the owners as well as their profit re-invested in the business. In a partnership firm, the funds contributed by the partners as capital are called ownership capital. Ownership capital remains permanently invested in the business.

Borrowed Capital: Borrowed fund include all funds available in the form of loans or credits. Loans are raised to business firms for specified periods at fixed rates of interest.

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