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State Whether the Following Statement Are True Or False. - Book Keeping and Accountancy


State whether the following statement are True or False.

The interest on drawings is an income of the partnership firm.


  • True

  • False

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True .

Explanation: Interest on drawings is a kind of fee charged from the partner on the amount withdrawn by him/her from the firm’s money for his/her personal use. So, it is an expense for the partner and accordingly, an income for the firm. Hence, the given statement is correct.

Concept: The Indian Partnership Act 1932
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Micheal Vaz Accounts - Book Keeping and Accountancy HSC 12th Standard Maharashtra State Board
Chapter 1 Introduction to Partnership
Exercise | Q 4 | Page 14
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