Which of the following is treated under partnership appropriation account?
Answer Details
Partnership appropriation account is a ledger account that records the distribution of profits or losses among partners in a partnership. It is used to allocate the net profit or loss of the partnership to the individual partners based on the agreed profit-sharing ratio.
Out of the options provided, the salary of a partner is treated under partnership appropriation account. This is because a partner's salary is considered as an appropriation of profit and is therefore deducted from the partnership's net profit to arrive at the distributable profit. The distributable profit is then allocated among the partners according to their agreed profit-sharing ratio.
The other options provided such as interest on loan, salary of workers, electricity and travelling expenses of a partner are not treated under partnership appropriation account as they are either expenses incurred in the ordinary course of business or they are not related to the distribution of profits among partners.