Question : Which one of the following items cannot be recorded in the profit and loss appropriation account?
Option 1: Interest on capital
Option 2: Interest on drawing
Option 3: Rent paid to partner
Option 4: Partner's salary
Answer (1)
13th Jan, 2024
Correct Answer: Rent paid to partner
Solution :
Rent paid to the partner will enter in profit and loss account debit side because it is consider as charge against profit according to firm point of view.
Hence, option 3 is the correct answer.
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