For English Users Need Solutions for T S Grewal ‘Partnership Accounts – Fundamentals’ for your Class 12 Accounts exams? We’ve got you covered! Below you will find clear explanations and solutions for all the T S Grewal Partnership Accounts – Fundamentals questions (Q Nos 01 to 10) following the latest CBSE/ICSE/State Boards curriculum (2024-2025). These […]
What is Profit and Loss Appropriation A/c Profit and Loss Appropriation Account is a nominal ledger account that records the allocation of net profit or loss among partners in a partnership firm. In a partnership, the profits or losses are distributed among partners according to the agreed terms as per the partnership agreement. Items in
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Meaning of Commission to Partners There are several ways in which the profits are appropriated among the partners. Like Interest on capital, salary and commission. As a part of appropriation of profits partners may be paid commission out of profits. It is shown in the profit and Loss Appropriation A/c on the debit side. As
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Meaning of Loan by firm to partner Meaning – If a partner borrows some amount from the firm for his personal expenses then such amount is treated as loan by firm to partner. Is it an Asset for firm – Yes this is an asset for the firm. It will be shown on assets side
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Meaning of Loan by partner to firm Meaning – Each partner contributes Capital to the firm. If a partner gives money to the firm over and above his capital contribution then such amount is treated as a loan by partner to firm. Is it a Liability for firm – Yes this is a liability for
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Meaning of Charge Against profits All the items which go to firms profit and loss A/c are charge against profits. These are called charge as these are to be paid whether the firm earns profits or incur losses. These items are deducted from the Revenue from operations (Sales) of firm to find the Net profit
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Meaning of Capital Meaning – In simplest terms , Capital means the amount that a person invests in business. This investment can be in any form be it cash or kind (Machinery, building, vehicle, stock, etc.).Considering that the business is a separate entity in accounting sese , the capital invested by the owner also becomes
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What is drawings in Partnership Accounts Drawings means any amount withdrawn , either in cash or kind, by partners for personal use from the firm. Usually we think that drawings is done only in cash. But this is not correct. Drawings can be done in the form of any asset like cash, machine, vehicle, computer,
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