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If partner salary is treated as normal business expense before net profit while it was appropriation what problem arises?

Answer and explanation

Correct answer: Net profit and appropriation both will be wrong

Partner salary is generally appropriation of profit not expense. Wrong classification understates net profit and misstates appropriation account.

Related tags

Partner SalaryClassification ErrorNet ProfitProfit DistributionPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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