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JAMB Principles of Accounts 2008 Question 39

Question 39

Partnership Accounts

The entry in the partnership books of accounts for interest on drawings is to

  1. A.credit partners capital account
  2. B.debit partners capital account
  3. C.credit drawings account
  4. D.debit drawings account
Show the answer and explanation

Answer: B (debit partners capital account)

Explanation

Interest on drawings is a charge against the partner, so his account is debited (and the appropriation account credited).