Multiple choice

What journal entry will take place when interest on a partner's loan is closed?

  1. Profit and Loss A/c Dr. To Interest on Partner's Loan A/c

  2. Interest on Partner's Loan A/c Dr. To Profit and Loss A/c

  3. Interest on Partner's Loan A/c Dr. To Partner's Loan A/c

  4. Partner's Loan A/c Dr. To Interest on Partner's Loan A/c

  5. Profit and Loss A/c Dr. To Partner's Loan A/c
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Yes, it is correct. When interest on partner's loan is closed, the journal entry will be - Profit and Loss A/c Dr. To Interest on Partner's Loan A/c.

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