passwella.
Menu

WAEC Financial Accounting 1991 (August) Question 43

Question 43

Partnership Accounts

Payment of salaries to partners is

  1. A.a charge to Profit and Loss Account
  2. B.a charge to Trading Account
  3. C.an appropriation of divisible profit
  4. D.an appropriation of interest on capital
  5. E.an appropriation of interest on current account.
Show the answer and explanation

Answer: C (an appropriation of divisible profit)

Explanation

Partners' salaries are a share-out of profit, shown in the appropriation account.