Match List – I with List – II.

Choose the correct answer from the options given below :

(A)-(IV), (B)-(III), (C)-(II), (D)-(I)

The correct answer is Option (3) → (A)-(IV), (B)-(III), (C)-(II), (D)-(I)

* Interest on partner's loan - Profit and Loss Account. Interest paid on a partner's loan is considered an expense to the partnership. Therefore, it is charged against the profits of the firm and is debited to the Profit and Loss Account. This ensures that the firm's expenses are accurately reflected in its profit calculations.  

* Personal account- Capital Account. Capital Account is a Personal Account. The Capital Account of a partner is classified as a Personal Account because it reflects the individual partner's investment in the partnership. Transactions related to the partner’s capital contributions and withdrawals are recorded in this account.

* Position statement- Balance Sheet. Balance Sheet is a Position Statement and is prepared at the end of period. The Balance Sheet is indeed a position statement that provides a snapshot of the firm’s financial position at a specific point in time. It lists assets, liabilities, and equity, helping stakeholders understand the firm's net worth.

* Commission to a partner- Profit and Loss Appropriation A/c. Partner's Commission is an appropriation of profit and is debited to Profit and Loss appropriation. It is only provided if firm earns profit, in case of loss it is not given to partners.