Match List – I with List – II.

Choose the correct answer from the options given below :

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

The correct answer is Option (2) - (A)-(II), (B)-(IV), (C)-(III), (D)-(I).

* Rent to partner- Debit side of Profit and Loss A/c.
The partnership firm is paying rent to partners. Rent paid to partners is a charge against profit. Debiting the Profit and Loss Account indicates an expense for the business which reduces the net profit of the firm.

* Interest on Drawings- Credit side of Profit and Loss Appropriation A/c.
The partner is being charged interest on the amount they have drawn from the business. Crediting the Profit and Loss Appropriation Account shows that this interest on drawings is an income for the firm.

* Bad Debts Recovered - Credit side of Profit and Loss A/c.
The previously written-off bad debts have been recovered. Crediting the Profit and Loss Account indicates that the recovered amount increases the profits of the firm.

* Salary to Partner- Debit side of Profit and Loss Appropriation A/c.
The salary is being paid to partners. Debiting the Profit and Loss Appropriation Account indicates that salary to a partner is an expense for the firm and income for the partner.