S1: The Profit and Loss Appropriation Account is prepared after the Profit and Loss Account. S2: It shows the distribution of net profit among partners. Which statement(s) is/are correct? MCQ with Answer and Explanation
S1: The Profit and Loss Appropriation Account is prepared after the Profit and Loss Account. S2: It shows the distribution of net profit among partners. Which statement(s) is/are correct?
A. S2 only
B. Neither S1 nor S2
C. S1 only
D. Both S1 and S2
Answer: Option D
Solution (By JKSSB Mock Tests)
The P&L Appropriation Account is an extension of the P&L Account, prepared after it. Its purpose is to distribute the net profit among partners by accounting for interest, salaries, and profit shares. Both are correct.
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