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If the partnership deed gives both interest on capital rate and profit sharing ratio but profit is insufficient what decision is needed first?

Answer and explanation

Correct answer: Whether interest is appropriation or charge

First decide whether interest is an appropriation or a charge. Normally it is an appropriation and is limited to available profit.

Related tags

Partnership DeedInterest On CapitalHardPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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