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The deed states that the firm will not pay any partners personal liability. What is the accounting meaning?

Answer and explanation

Correct answer: Personal liability will not be treated as firms liability

A partners personal liability is not a firm liability in the books. If the firm pays it the amount is charged to that partners drawings or current account.

Related tags

Personal LiabilityDrawingsPartnership DeedPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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