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Reserve Rs 25000 was wrongly credited to appropriation account though it should be debited. By how much will distributable profit be overstated?

Answer and explanation

Correct answer: Rs 50000

Reserve should have been debited but was credited. So profit is overstated by twice the amount which is Rs 50000.

Related tags

ReserveError EffectAppropriationProfit DistributionPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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