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Do all forms of business organisations prepare a Profit and Loss Appropriation Account? - Accounts

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Question

Do all forms of business organisations prepare a Profit and Loss Appropriation Account?

Short Answer
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Solution

No, only partnership firms prepare a Profit and Loss Appropriation Account. This account is used to distribute the profits among the partners, accounting for items like interest on capital, salary to partners, and the division of profits according to the profit-sharing ratio.

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Chapter 1: Accounting for Partnership Firms - Fundamentals - SHORT ANSWER QUESTIONS [Page 1.128]

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D. K. Goel Accountancy Volume 1 and 2 [English] Class 12 ISC
Chapter 1 Accounting for Partnership Firms - Fundamentals
SHORT ANSWER QUESTIONS | Q 22. | Page 1.128
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