Amount due to outgoing partner is shown in the balance sheet as his

The correct answer is A. Liability.

A liability is a company’s legal financial debts or obligations that arise during the course of business operations. Liabilities are settled over time through the transfer of economic benefits, such as cash, goods, or services.

In the case of an outgoing partner, the amount due to them is a liability of the company. This is because the company owes the money to the partner, and must pay it back at some point in the future.

The other options are incorrect for the following reasons:

• Asset: An asset is a company’s economic resources that have the potential to provide future benefits. The amount due to an outgoing partner is not an asset of the company, because it does not have the potential to provide future benefits.
• Capital: Capital is a company’s equity, or the difference between its assets and liabilities. The amount due to an outgoing partner is not part of the company’s capital, because it is a liability.
• Loan: A loan is a debt that is incurred by a borrower from a lender. The amount due to an outgoing partner is not a loan, because it is not a debt that the company has incurred.