Question

Where will the royalty be shown?
a. Capital-liability side of balance sheet
b. Asset and receivable side of balance sheet
c. Debit side of profit-loss account
d. Debit side of the trading account​

Answer 1

Answer:

Where will the royalty be shown?

a. Capital-liability side of balance sheet

a. Capital-liability side of balance sheetb. Asset and receivable side of balance sheet

a. Capital-liability side of balance sheetb. Asset and receivable side of balance sheetc. Debit side of profit-loss account✔️

d. Debit side of the trading account

Explanation:

It is a nominal account and at the end of the accounting year, balance of Royalty account need to be transferred to the normal Trading and Profit & Loss account. Royalty, based on the production or output, will strictly go to the Manufacturing or Production account.