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If interest on capital is two thousand rupees and interest on drawings is five hundred rupees what is the net effect on partner account?

Answer and explanation

Correct answer: Increase of one thousand five hundred rupees

Interest on capital is credited and interest on drawings is debited. Net increase is two thousand minus five hundred which is one thousand five hundred.

Related tags

Interest EffectNumericalPartner AccountCapital AccountsPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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