Accountancy Part AAccounting for Partnership

Salary of a partner is shown in..............

Answer & explanation

Correct answer: option 2

The correct answer is Option (2) → Profit and Loss Appropriation A/c

Salary to a partner is not an expense of the firm but a share of profit paid under the deed. So it is shown in the Profit and Loss Appropriation Account, which divides the net profit among the partners.

Why the other options are incorrect

Option (1) Profit and Loss A/c — Incorrect. It carries the expenses of the business; salaries to employees go there, but not a partner’s salary.
Option (3) Trading A/c — Incorrect. It shows direct trading items to find gross profit.
Option (4) Manufacturing A/c — Incorrect. It shows the cost of production.

NCERT (2026-27 edition):
Profit and Loss Appropriation Account – “Profit and Loss Appropriation Account is merely an extension of the Profit and Loss Account of the firm. It shows how the profits are appropriated or distributed among the partners. All adjustments in respect of partner’s salary, partner’s commission, interest on capital, interest on drawings, etc. are made through this account.”