Give the adjusting and Closing entry for recording interest on drawins charged from the partners when the firm follows the fixed capital method.
Give the adjusting and Closing entry for recording interest on drawins charged from the partners when the firm follows the fixed capital method.
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Answer:-
Adjusting Entry:
Partner’s Current A/cs …Dr.
To Interest on Drawings A/c
Closing Entry:
Interest on Drawings A/c …Dr.
To Profit and Loss Appropriation A/c
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