Question

For the firm interest on Capital is a 1 point
O Capital Payment
O Capital Receipt
O Loss
O Income​

Answer 1

Answer:

interest on capital is capital payment.

Explanation:

Firm and entrepreneur are separate.

The capital put by the entrepreneur is liability provided by him to the firm.

so payment of interest on liability is a capital payment to the firm...

Hope this is helpful

Answer 2

Explanation:

Interest on capital is an expense to the firm and is debited to the profit and loss appropriation account. Interest is payable to the partners and hence, the partner's capital account is credited with the amount of interest. In case of loss, no interest will be allowed on capital.