Accounting WAEC

Where fixed capitals are maintained in a partnership, share profits are?

A. Credited to partners capital accounts
B. Credited to partners current accounts
C. Debited to partners capital accounts
D. Debited to partners current accounts

Correct Answer: Option B

B. Credited to partners current accounts

Explanation

Each partner has a separate current account and includes;

• The credit side of the current account shows all the profits of the partners

• The credit side of the current account shows all the profits of the partner such as salary, interest on capital and the share of residue profits.

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