banner_ad

Income or Expense?

Others 577 views 10 replies
Charge Interest of Rs 500 on drawings.
in profit and loss account where should it be put?
in debit or credit
Replies (10)

Debit interest expense..

 Interest on drawings is income to the  business and  expense (loss) to proprietor will be debited to Capital account.. 


 

The interest is Expense...

Debit in Interest Expenses &
Credit into Capital Account...

Same  thing  in case of  Partnership Firm  , partners withdraw Goods or money ( Drawings )  from the  Business , so as per  partnership  deed   Business charge  Interest   on Drawing  to  partners  , therefore  Interest  on Drawings  is Income  to the  partnership  Firm (Business )   and  expense  (loss ) to the  partners . 

Is it proprietorship or partnership?

Proprietor need not pay interest on drawings since after tax profit completely belongs to proprietor
Thank-you everyone

You are welcome.           

Ok so partnership accounting has the henious form and legality. Why didn't they come into business combinations? Very funny!

Check the initial query .

It says interest on drawings ?
Yes , agree with @ Eswar Reddy . please check initial query.


CCI Pro

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
ARTICLESHIP 27 May 2026
CA Article Trainee

Rahul Dang & Associates-Chartered Accountants

Pune

CA Inter

View Details
Company
22 May 2026
Audit assistant

Displayandbeyond

Mumbai

CA

View Details
Company
19 May 2026
Fundraising Expert

MentorsWorld Ventures Private Limited

Ahmedabad

Others

View Details
Company
ARTICLESHIP 28 May 2026
Accounts, Audit & Compliance Executive

Shyam Joshi & Associates

Pune

B.Com

View Details
Company
27 May 2026
Audit Assitant

Virender K Gupta and Co

New Delhi

B.Com

View Details
Company
ARTICLESHIP 31 May 2026
Article Assistant

KPRS And Associates

New Delhi

CA Inter

View Details
Company
Featured 26 May 2026
Account Executive

SMJ global advisors pvt ltd

New Delhi

B.Com

View Details
Company
18 May 2026
MIS Executive

Primarc Pecan Retail Limited

Mumbai

B.Com

View Details