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A and B shared profit equally. Later it was found that A's salary of ₹12000 was due and interest on B's drawings of ₹4000 was to be charged. What is the net correction?

Answer and explanation

Correct answer: Credit A ₹8000 and debit B ₹8000

A's salary gives A a net benefit of ₹6000 and B's drawings interest gives A an extra ₹2000. Total correction is ₹8000 in favour of A.

Related tags

PartnershipPast AdjustmentCombined AdjustmentAdjustmentsPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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