Practicing Success
On the death of a partner during the year, his share of profit is debited to which account out of the following? |
Profit and Loss Account Profit and Loss Appropriation Account Profit and Loss Suspense Account Deceased Partner's Capital Account |
Profit and Loss Suspense Account |
The correct answer is Option 3 - Profit and Loss Suspense Account. To account for the deceased partner's share of profits and loss during the interim period in the company's financial records, the following journal entry is recorded: FOR PROFIT- FOR LOSS- |