Target Exam

CUET

Subject

-- Accountancy Part A

Chapter

Accounting for Partnership

Question:

Where will be the manager's commission shown by a partnership firm?

Options:

Profit and Loss account

Profit and Loss appropriation account

Balance Sheet

Partner's Capital account

Correct Answer:

Profit and Loss account

Explanation:

The correct answer is option 1- Profit and Loss account.

Manager's commission is not related to partner. It is expenditure of firm and shown in Profit & loss account on the debit side. This account records all the income and expenses of the firm. The manager's commission is considered an expense of the business, so it is shown here.