Dividend and interest are _______.

A. synonymous terms

B. different from each other

C. debited to profit and loss account

D. divisible profits

Answer: Option C

Solution(By Examveda Team)

Dividend and interest are debited to profit and loss account. Debentures interest is a business expensed and therefore, it is a charge against profit and as such profit and loss account is debited with the total amount of interest payable during the accounting year whether the company has earned the profit or not.