Which of the following entry shows withdrawal of excess capital by pa…

The correct answer is Option (1) → Partner’s capital A/c is debited and Cash/Bank A/c is credited

When the continuing partners adjust their capitals to the new ratio, a partner whose capital is more than his required share takes the excess out in cash. Money leaves the firm, so Cash/Bank is credited; the partner’s capital falls, so his Capital A/c is debited.

Partner’s Capital A/c     Dr.
    To Cash/Bank A/c

The reverse entry (Cash/Bank debited, Capital credited) records a partner bringing in cash to make up a shortage of capital.