The Key Difference Between a Partnership Income Statement and a Standard

question 68

Multiple Choice

The key difference between a partnership income statement and a standard business income statement is that the partnership income statement:

• A)shows the distribution of profit/(loss)to each partner below the profit/(loss)line.
• B)shows the division of each expense into partners' respective interests.
• C)does not show sales revenues.
• D)is split into separate columns, one for each partner.

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Definitions:

Business Transaction

An economic event or condition that directly changes an entity’s financial condition or directly affects its results of operations.

Journal

A detailed record where all financial transactions of a business are initially recorded in chronological order.

Laser Equipment

Tools or devices that use laser technology for various applications such as cutting, engraving, or medical surgery.

Purchased

Acquiring goods, services, or assets in exchange for money or its equivalent.