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In what way would you deal with rent paid to a partner for the use of his premises by the firm in which he is a partner and why?

  • Post category:Accountancy
  • Reading time:1 mins read

SOLUTION

Rent paid to a partner is a usual business expense incurred towards use of property. It is a charge on profits. Hence, it is debited to Profit & Loss Account.

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Previous PostWould a ‘charitable dispensary’ run by 8 members be deemed a partnership firm? Give reason in support of your answer.
Next PostState the closing entries for: (a) rent paid to a partner; (b) interest on loan allowed to partners.

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