If the deed says profit is to be used first for salary, then interest on capital, and finally shared in ratio, why is the order important?

Correct answer: Because appropriations will be made in that order

Direct answer: Option A, appropriations are made in that order. Profit appropriation means deciding how the available profit is distributed or applied among permitted partner claims and the remaining share. If the deed says salary first, interest on capital second, and residual profit in the agreed ratio last, that sequence must be followed. Step by step: calculate profit available; provide the stated salary; provide interest on capital as required; distribute the balance in the profit-sharing ratio. When profit is insufficient, the stated order can change the amount available for later items, so it is important. Option A is correct. Option B is wrong because the order of appropriation does not determine when sales occur. Option C is irrelevant because bank opening has no connection with profit distribution. Option D is irrelevant because partners’ ages do not decide accounting order. Memory cue: follow the deed’s sequence from first appropriation to final division.