Question : Assertion (A): Rent paid to a partner is transferred to the debit of the profit and loss account but not to the debit of the profit and loss appropriation account. Reason (R): Rent paid to a partner is a cost that is deducted from profits rather than being appropriated from profits. As a result, it is added to the Profit and Loss Account's debit.
Option 1: Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
Option 2: Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A).
Option 3: Assertion (A) is true but Reason (R) is False
Option 4: Both Assertion (A) and Reason (R) are not correct
Correct Answer: Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
Solution : Both Assertion and Reason are true and Reason correctly explain the assertion.
Hence the correct answer is option 1.
Question : Assertion (A) : Profit and Loss Appropriation account shows the correct profit earned by the firm.
Reason (R) : The net Profit adjusted after takin into account the interest on capital, Interest on drawings, Salaries/ Commission Paid
Question : Assertion (A): A partner's salary is deducted from the profit and loss account.
Reason (R): A partner's salary is a appropriation of profit.
Question : Assertion (A): A partner's interest on capital is paid only from profits. Reason (R): Interest on capital is a profit appropriation that must be provided regardless of profit or loss.
Question : Assertion (A): A profit and loss appropriation account is prepared to show how profits are distributed among partners in accordance with the Partnership Deed.
Reason (R): Only the working partner(s) have access to the books of accounts.
Question : Assertion (A) Rent due to a partner is not transferred to the rent payable account but rather to the credit of the partner's capital account. Reason (R): Paying rent to a partner for allowing the company to utilise his personal property for commercial purposes is a
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