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Which of the following is not considered a legitimate expense of a partnership? a Interest paid to partners based on the amount of invested capital. b Depreciation on assets contributed to the partnership by partners. c Salaries for management hired to run the business d Supplies used in the partners' offices.

Respuesta :

eooyibo123

Answer:

a Interest paid to partners based on the amount of invested capital.

Explanation:

A partnership is formed between two parties that agree to go into a venture for mutual gain. The parties share ownership of the business entity and as such are entitled to profit from their equity holdings.

Interest paid based on invested capital is considered a distribution of profit by the business and not an expense. This is similar to sharing profit to shareholders in a company.

Legitimate expenses include: cost of sales, staff cost, administrative costs, advertising costs, and professional expenses like hiring an accountant.

Parrain

Out of all the options listed, the one that is not considered a legitimate expense in a partnership is a. Interest paid to partners based on the amount of invested capital.

Some legitimate expenses in a partnership are:

  • Asset depreciation in the business
  • Supplies used by the partners
  • Salaries paid to management staff

Interest on invested capital is not considered an expense and is only realized after the calculation of profit.

In conclusion, interest on partnership capital is not an expense.

Find out more at https://brainly.com/question/24100876.

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