Current account

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
When we do current account

Dr Drawings
Cr Interest in Capital
Cr Salary
Cr Share profit

When we do the Balance Sheet

Financed by :
Capital

Interest
Current Account

Why we have to record again in the Balance sheet the interest in capital ????
:oops:

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Current account

    I don't think I'm quite sure what your asking. When you work out the appropriation for partners current accounts you just credit the amount of profit they are allowed (including the interest on capital) to their current account. The double entry for this is the net profit in the profit/loss. There's no seperate account for interest on capital.

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