Interest on drawings is ___ for the business
A. Loss
B. Expense
C. Gain
D. None of the above
Answer: Option C
Solution(By Examveda Team)
Interest on drawings is gain for the business. Interest on drawings is an income to the firm, and hence it is credited to the profit and loss appropriation account. On the other hand, interest on drawings is an expense to the partners, and hence it is debited to their capital accounts.This Question Belongs to Commerce >> Accounting
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