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Questions and Answers
What is the main purpose of partnership accounts?
What is the main purpose of partnership accounts?
- To manage the inventory of the partnership business
- To record the financial transactions of a partnership business (correct)
- To calculate the company's total revenue
- To keep track of individual partner's personal expenses
In partnership accounts, what does the term 'capital' refer to?
In partnership accounts, what does the term 'capital' refer to?
- The total sales revenue of the business
- The amount of money owed to creditors
- The cost of goods sold by the business
- The money invested by partners in the business (correct)
What is the purpose of preparing a profit and loss appropriation account in partnership accounting?
What is the purpose of preparing a profit and loss appropriation account in partnership accounting?
- To manage the company's payroll system
- To record the personal expenses of each partner
- To calculate the total revenue of the business
- To distribute profits or losses among partners (correct)
What does the 'revaluation account' represent in partnership accounts?
What does the 'revaluation account' represent in partnership accounts?
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