The Profit and Loss Appropriation Account is merely an extension of the Profit and Loss Account of the firm.Which among the following is NOT shown in the Profit and Loss Appropriation Account?
- AAll adjustments in respect of partner's salary.
- BAll adjustments in respect of payment to Vendor.
- CAll adjustments in respect of interest on capital
- DAll adjustments in respect of interest on drawings
Solution & Step-by-step Explanation
The Profit and Loss Appropriation Account is explicitly designed to show how the firm's net profit is distributed among the partners (e.g., partner salaries, interest on capital, interest on drawings, and general reserve transfers). Payments to vendors are external business transactions recorded as charges in the regular Profit and Loss Account, not the internal appropriation layout.