Accountancy Part AAccounting for Partnership

Select the items which will be recorded in Partner's capital Accounts…

Select the items which will be recorded in Partner's capital Accounts as per Fixed Capital method.

A. Withdrawal of capital
B. Drawings
C. Additional Capital
D. Interest on Capital
E. Interest on Drawings

Choose the correct answer from the options given below:

Answer & explanation

Correct answer: option 1

The correct answer is Option (1) → A and C only

Under the fixed capital method the capital account changes only when capital itself changes; every other item goes to the partner’s current account.

A. Withdrawal of capital — True. A permanent withdrawal of capital is debited to the capital account.

B. Drawings — False. Drawings go to the current account.

C. Additional Capital — True. Capital introduced is credited to the capital account.

D. Interest on Capital — False. It is credited to the current account.

E. Interest on Drawings — False. It is debited to the current account.

NCERT (2026-27 edition):
Fixed Capital Method – “… Under the fixed capital method, the capitals of the partners shall remain fixed unless additional capital is introduced or a part of the capital is withdrawn as per the agreement among the partners. All items like share of profit or loss, interest on capital, drawings, interest on drawings, etc. are recorded in a separate accounts, called Partner’s Current Account.”