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 deals with appropriations of profit among partners (such as Interest on Capital, Interest on Drawings, Partner Salary, and Commission). Payments to external vendors are charges against profit and are recorded in the standard Profit and Loss Account, not the Appropriation Account.