With the fixed capital balances method (method 2) of accounting for partnership equity, the general journal entry to record interest on capital is:
A) DR Profit or loss summary account; CR Partner's capital accounts.
B) DR Profit or loss summary account; CR Partner's retained earnings accounts.
C) DR Profit distribution account; CR Partner's capital accounts.
D) DR Profit distribution account; CR Partner's retained profit accounts.

Question

Quizplus · Accepted Answer

The Answer of With the fixed capital balances method (method 2) of accounting for partnership equity, the general journal entry to record interest on capital is:
A) DR Profit or loss summary account; CR Partner's capital accounts.
B) DR Profit or loss summary account; CR Partner's retained earnings accounts.
C) DR Profit distribution account; CR Partner's capital accounts.
D) DR Profit distribution account; CR Partner's retained profit accounts.

With the Fixed Capital Balances Method (Method 2) of Accounting