Top ads from clicksor

Wednesday, May 19, 2010

Reserve for Redemption of Liabilities

The firm requires to manage big amount to redeem long term liabilities like debentures. Thus, a reserve is created out of profit for the redemption of liabilities which is called reserve for redemption of liabilities.

  1. Loan can be repaid in specific date which increases the creditability of the business.
  2. It helps to avoid the financial crises of repaying liabilities.
  1. It reduces the amount of divisible profit of shareholders.

No comments:

Post a Comment

Your Luck Goes Here

Search your luck

Search Term:


Add to Technorati Favorites