Which statement relating to financial reports for a partnership is not true?
A) Partners' salaries are normally treated as an allocation of profit.
B) Income tax expense is deducted from the partnership profit at the end of the income statement.
C) Each individual partner's equity in the business is reported separately.
D) Interest on capital contributions is treated as an allocation of profits.

Question

Quizplus · Accepted Answer

Income tax expense is not deducted from the partnership profit at the end of the income statement. Instead, each partner's share of the partnership's taxable income is calculated and reported on their individual tax returns. The other options are true statements relating to financial reports for a partnership.

Which Statement Relating to Financial Reports for a Partnership Is