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Profit and loss appropriation account

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Querist : Anonymous

Querist : Anonymous (Querist)

24 June 2014
I was studying for the competetive test.there i came across one question stating that proviosion for income tax is not recorded in profit and loss appropriation account.is it true.other options are transfer to general reserve proposed dividend and dividend equalisation fund. please need a help over this confusion.

Rupesh Jain

Rupesh Jain (Expert)
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24 June 2014 in profit and loss a/c only income and tax related to income will show. after tax profit is net income of business . after that you can do any thing with the profit. if management want to tfr the amount for company work then general reserve a/c

if they want to give dividend to the share holder then tfr to proposed dividend a/c

Querist : Anonymous

Querist : Anonymous (Querist)

24 June 2014 even provision for taxation will come there

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