Interest on a partner's drawings is debited to the

Assessment: JAMB UTME - Principles of Accounts - 1995 Subject: Financial Accounting

Question 1 Report

Interest on a partner's drawings is debited to the
Answer Details
Interest on a partner's drawings refers to the interest charged on the amount of money withdrawn by a partner from the business for personal use. This interest is charged by the partnership firm to the partner, and therefore, it is debited to the Partner's current account. At the same time, since it is an expense for the partnership firm, it is credited to the profit and loss appropriation account. Therefore, the correct answer is "Partners current account and credited to the profit and loss appropriation account."
Read lesson note on Partnership Accounts (WAEC)
Read lesson note on Partnership Accounts (JAMB)
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