O-LevelAccountingAccounting procedures7707/13 · Oct/Nov 2021 · Q201 Mark

Kasi and Ravi are in partnership. The financial statements for the year ended 31 August 2021 showed that Ravi was entitled to interest on capital and interest on loan and was charged interest on drawings. Which entries would be made in Ravi's current account?

Ainterest on capital: credit, interest on loan: credit, interest on drawings: debit

Binterest on capital: credit, interest on loan: debit, interest on drawings: credit

Cinterest on capital: debit, interest on loan: credit, interest on drawings: debit

Dinterest on capital: debit, interest on loan: debit, interest on drawings: credit

✓ Correct answer

C: interest on capital: debit, interest on loan: credit, interest on drawings: debit

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Topic: Accounting procedures, O-Level Accounting (syllabus 7707). Multiple choice, 1 mark.
Source: O-Level Accounting, Oct/Nov 2021 Paper 1 Variant 3, question 20.

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