Multiple choice

If the capital accounts are fixed and commission is paid to a partner, it will be shown in

  1. debit side of partner's current account

  2. credit side of partner's current account

  3. debit side of partner's capital account

  4. credit side of partner's capital account

Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

It will be shown on the credit side of partner's current account. When the capital is fixed, the current accounts of partners are prepared. It is an income for the partner. So, it will be shown on the credit side of the partner's current account.