Post Utme Eksu 2023 Accounting Question 20

Practice objective / multiple choice question 20 from the 2023 Post Utme Eksu Accounting examination.

Post Utme Eksu 2023 Accounting Objective / Multiple Choice
Question 20 POST_UTME_EKSU • 2023 • ACCOUNTING • objective

A company's partnership agreement requires that profits be distributed in the ratio of 2:3:5. However, the company's financial statements show a net profit of ₦500,000. What is the correct accounting treatment for the net profit of ₦500,000?

Answer Options

Correct Answer A. Debit the Profit and Loss account and credit the Partners' Capital accounts in the ratio of 2:3:5 for ₦500,000.
B. Debit the Partners' Capital accounts and credit the Profit and Loss account in the ratio of 2:3:5 for ₦500,000.
C. Debit the Profit and Loss account and credit the Cash account for ₦500,000.
D. Debit the Cash account and credit the Profit and Loss account for ₦500,000.
Correct Answer
A
Correct Option:
Debit the Profit and Loss account and credit the Partners' Capital accounts in the ratio of 2:3:5 for ₦500,000.

About This Question

This is Post Utme Eksu 2023 Accounting Question 20. It is one of the objective questions from the 2023 Post Utme Eksu Accounting examination.

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