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Under fluctuating capital method partner salary was credited to capital account when due and debited again on payment. What is the net effect?

Answer and explanation

Correct answer: Net effect on capital after payment will be zero

Salary credited when due and debited on payment gives equal opposite effects. If paid immediately net effect on capital can be zero.

Related tags

Partner SalaryPaymentFluctuating CapitalCapital AccountsPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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