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Partnership Unit-1
Accountancy
Rent paid to partner is a charge against profit . That's why it is shown in p&l account but in illustration 9 of module it is shown in p&l appropration account.
Answers (6)
Both views are possible. Assume that the partner gave a building for use by the firm on which rent is charged. Another partner gave capital on which interest is charged. Both partners have given assets to the firm on which they get returns. So both can be considered as appropriation of profits.
CA Suraj Lakhotia Admin
Both views are possible. Assume that the partner gave a building for use by the firm on which rent is charged. Another partner gave capital on which interest is charged. Both partners have given assets to the firm on which they get returns. So both can be considered as appropriation of profits.
Sir but partner is paying rent na sir then it should be in appropriation account sir then why it is should written in p&l sir
sai t
Sir but partner is paying rent na sir then it should be in appropriation account sir then why it is should written in p&l sir
Question is rent paid to partner, not by a partner. And as mentioned abive, both views are possible.
