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The deed states that losses will also be shared in the profit ratio. Which principle does this provision clarify?

Answer and explanation

Correct answer: Sharing of profit and loss

In partnership, both profit and loss are shared according to rules. The profit ratio often becomes the loss ratio too.

Related tags

Profit And Loss SharingDeed ClauseBasic ConceptPartnership DeedPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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