Treatment of Rent Paid to a partner in Partnership class 12

Are you looking for the accounting treatment and journal entry of rent paid to a partner in Accounting for partnership firm – Fundamentals chapter of class 12 CBSE Board

I have elaborate this concept in detail.

See, rent paid to partner is considered as charge against profit and recorded in profit and loss account as expense. It is not considered as appropriation thus not recorded in profit and loss appropriation account.

The rent is paid to partner against the personal property of the partner used by the firm.

Rent may be paid either in cash or by cheque during the year or it may have become due and not yet paid.

Following are Journal entries in all cases.

Journal entries of Rent to partner by the firm

following are the Journal entries in different cases:-

1. When rent is paid in cash or by Cheque:-

Rent A/c …Dr
To Cash/Bank A/c
(Rent paid in cash/cheque for… )

2. When rent is payable (Due but not paid)

Rent A/c …Dr
To Partners Capital/Current A/c
(Rent payable for… )

3. When Rent account is transferred to profit and loss account

Profit and Loss A/c …Dr
To Rent A/c
(Rent account transferred to profit and loss account)

Note:- Rent paid to partner is considered as charge against profit and has to be paid irrespective of profit or loss to the firm.

Following are specimen of its posting with two alternative in partnership Account.

Or

S.N	Topics
1.	Definition of Partnership
2.	Features of Partnership
3.	What are the Rights of Partners
4.	What is Partnership Deed, Meaning, content
5.	What are the Rules in the absence of a Partnership Deed
6.	What are the Rules in the absence of Partnership Deed
7.	What are the Liabilities of Partners
8.	Profit and Loss Appropriation Account format, features
9.	Journal Entries of Profit and Loss Appropriation A/c
10.	Difference between Profit and Loss A/c and Profit and Loss Appropriation A/c

S.N	Topics
11.	Difference between charge against profit and appropriation of Profit
12.	Treatment of Interest on loan by the firm to the partner
13.	Treatment of Interest on loan by the Partner to the firm
14.	Treatment of Rent paid to partner in partnership firm
15.	Accounting Treatment of Managers commission in partnership
16.	Items not shown in Profit and Loss Appropriation A/c
17.	Methods of Maintaining Partners Capital A/c
18.	Accounting Treatment When Appropriation is more than the Available Profit
19.	Difference Between Fixed Capital A/c and Fluctuating Capital A/c
20.	Difference Between Capital and Current A/c