MyQuestionIcon

1

You visited us 1 times! Enjoying our articles? Unlock Full Access!

Profit or Loss Appropriation A/c

Which of the ...

Question

Which of the following account will be debited when interest on capital is charged against the distribution of profit?

A

Interest account

No worries! We‘ve got your back. Try BYJU‘S free classes today!

B

Partner`s capital account

No worries! We‘ve got your back. Try BYJU‘S free classes today!

C

Profit & loss account

No worries! We‘ve got your back. Try BYJU‘S free classes today!

D

Profit & loss appropriation account

Right on! Give the BNAT exam to get a 100% scholarship for BYJUS courses

Open in App

Solution

The correct option is D
Profit & loss appropriation account

Profit & loss appropriation account is debited.

Suggest Corrections

thumbs-up

1

Similar questions

Which of the following account will be credited when interest on capital is charged against the distribution of profit?

Q. Interest on capital is given from profit and loss appropriation account to a partner __________________.

Q. If interest on capital, salary to the partner and share of profit are credited while interest on drawings, drawings and share of loss are debited to the Partners' Capital Accounts, what is the method followed to maintain the Capital Accounts?

Q. Is Interest on Loan by partner debited to Profit and Loss Appropriation Account?

Q. P, Q and R are in a partnership and as at 1st April, 2017 their respective capitals were: ₹ 40,000, ₹ 30,000 and ₹ 30,000. Q is entitled to a salary of ₹ 6,000 and R ₹ 4,000 p.a. payable before division of profits. Interest is allowed on capital @ 5% p.a. and is not charged on drawings. Of the divisible profits, P is entitled to 50% of the first ₹ 10,000, Q to 30% and R to 20%, rest of the profit are shared equally. Profits for the year ended 31st March, 2018, after debiting partners' salaries but before charging interest on capital was ₹ 21,000 and the partners had drawn ₹ 10,000 each on account of salaries, interest and profit.
Prepare Profit and Loss Appropriation Account for the year ended 31st March, 2018 showing the distribution of profit and the Capital Accounts of the partners.

View More

Join BYJU'S Learning Program

similar_icon

Related Videos

lock

Accounting Aspect

ACCOUNTANCY

Watch in App

explore_more_icon

Explore more

Profit or Loss Appropriation A/c

Standard XII Accountancy

Join BYJU'S Learning Program

CrossIcon