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the partner may take interest on capital balance this amount also distribution of income not expenses

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the partner may take interest on capital balance this amount also distribution of income not expenses

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Answer #1

FALSE

For the partnership firm ,salaries and interest payable to partners is an expense to the firm. Interest is calculated  based on the capital share of the partners.The partners will have income distribution in the form of interest in the above case.Interest on capital is routed through profit and loss appropriation account .


answered by: Shaik sultan
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