Neha, a partner, owns a building in which the firm carries its business. The firm pays her $R s . 10, 000$ as rent of the building. To which account rent will be debited?

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Solution

When a partner advances some amount more than the capital invested it is termed as loan by partner. But when some fixed assets are given by partners to the firm for carrying on the business,then its not termed as loan.
Neha, a partner owns a building and firm carries on its business in her premises. In turn,the firm pays her rent.This rent is an expense for the firm. So,Rent will be debited to Profit and Loss Account of the partnership firm.

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Neha, a partner, owns a building in which the firm carries its business. The firm pays her Rs.10,000 as rent of the building. To which account rent will be debited?

Neha, a partner, owns a building in which the firm carries its business. The firm pays her $R s . 10, 000$ as rent of the building. To which account rent will be debited?