Target Exam

CUET

Subject

-- Accountancy Part A

Chapter

Accounting for Partnership

Question:

Pick the odd one out of the following on the basis of the charge against profit or appropriation of profit.

Options:

Interest on partner’s Capital

Manager’s Commission

Rent to Partner

Interest on Partner’s Loan

Correct Answer:

Interest on partner’s Capital

Explanation:

The correct answer is option 1- Interest on partner’s Capital.

Besides of interest on partners' capital, all others are charge against profit and debited to profit and loss account. Interest on partners' capital is an appropriation of profit and transferred to profit & loss appropriation account.