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The deed says profit will be distributed only after creating general reserve. Which principle does this show?

Answer and explanation

Correct answer: Profit appropriation according to deed priority

Reserve is created before profit distribution when the deed says so. In exams carefully follow the given order.

Related tags

General ReserveAppropriationPriorityPartnership DeedPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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