The interest on the Capital Accounts of partners is credited to
A. Interest A/c
B. Partners Capital A/c
C. Profit and Loss A/c
D. Profit and Loss Appropriation A/c
Answer: Option B
This Question Belongs to Commerce >> Accounting
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Accounting provides information on
A. Cost and income for managers
B. Company's tax liability for a particular year
C. Financial conditions of an institutions
D. All of the above
The long term assets that have no physical existence but are rights that have value is known as
A. Current assets
B. Fixed assets
C. Intangible assets
D. Investments
The assets that can be converted into cash within a short period (i.e. 1 year or less) are known as
A. Current assets
B. Fixed assets
C. Intangible assets
D. Investments
Patents, Copyrights and Trademarks are
A. Current assets
B. Fixed assets
C. Intangible assets
D. Investments
The interest on the Capital Accounts of partners is typically credited to the Partners Capital A/c.
B. Partners Capital A/c
Interest on the Capital Accounts represents the return on the partners' investments in the business. It is considered as a part of their capital contribution and therefore is credited to their respective Capital Accounts. By crediting the interest to the Partners Capital A/c, it increases their individual capital balances and reflects the growth of their investments due to the interest earned.
Therefore, the correct answer is B. Partners Capital A/c.