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In a firm interest on capital (₹40000) and partner salary (₹20000) are payable. Available profit is only (₹30000) and the deed gives priority to interest on capital. How much salary will be allowed?

Answer and explanation

Correct answer: Nil

Interest on capital has priority and the available profit is already insufficient for it. So no profit remains for salary.

Related tags

PartnershipAdjustmentsPriority ClausePartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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