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  • Partnership and Not-for-Profit Accounting
  • Interest on partner's loan is a
Multiple choice

Interest on partner's loan is a

  1. charge against profit.

  2. appropriation out of profit

  3. appropriation out of assets

  4. none of these

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

It is a charge against profit because it is paid to partner before calculating the profit and has to be paid even if there is a loss.

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