What journal entry will be passed when a firm pay realisation expenses on behalf of the partnerswWho is to bear the expenses?
Dear Student
In a case when partners are to bear expenses and firm pays it on behalf of them, then here firm shall recover the amount from partners and the journal entry would be passed by debiting partners capital account as follows :
Regards
In a case when partners are to bear expenses and firm pays it on behalf of them, then here firm shall recover the amount from partners and the journal entry would be passed by debiting partners capital account as follows :
Partners Capital A/c | Dr. | xxx | |
To Cash A/c | xxx | ||
(Being expenses of realization paid on behalf of partners) | |||
Regards