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Home Questions 3UPPZBTHJN
Target Exam

CUET

Subject

Accountancy

Chapter

Accounting for Partnership

Question:

What will be the journal entry for allowing salary to partners by a partnership firm?

Options:

Salary to Partner A/c  Dr.
     To Partner’s Capital A/c
(Salary to partner is allowed)

Salary to Partner A/c   Dr.
     To Partner’s Current A/c
(Salary to partner is allowed)

 Partner’s Capital A/c Dr.
     To Salary to Partner A/c
(Salary to partner is allowed)

Either option 1 or 2

Correct Answer:

Either option 1 or 2

Explanation:

For allowing salary to partners:
Salary to Partner A/c Dr.
     To Partner’s Capital/Current A/c’s (individually)
(Salary to partner is allowed)
And it is transferred to profit and loss appropriation Account by debiting P & L Appropriation A/c and crediting salary to partner A/c.
Capital or current account is depend on the method followed by the partnership firm for maintaining the capital accounts of the partners.

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