A paid advertisement expense of Rs 15000 for the firm from personal account. What is the correct adjustment in As account?

Correct answer: Credit Rs 15000 to As account

Direct answer: Option A, credit Rs 15,000 to A’s account. The advertisement was a cost of the firm, but A paid it personally. Therefore the firm received the benefit while A used his own money. This creates a liability of the firm to A. To record that liability, A’s capital or current account is credited with Rs 15,000. Option A is correct because a credit records the amount owed to the partner. Option B is wrong because debiting A would suggest that A owes the firm or has received a benefit from it, which is not the situation. Option C is wrong because the expense is a business expense, not an appropriation of profit. Option D is wrong because A did not withdraw money; he paid money for the firm. Thus the adjustment gives A credit and records the firm’s expense separately.