Which statement is not true about Capital Accounts of Partner-
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Under the fluctuating capital method, two account, i.e. capital account and current account is maintained for each partner.
Under the fluctuating capital method, two accounts, i.e. capital account and current account is maintained for each partner. Not true — Under the fluctuating capital method, only one account (the Capital Account) is maintained for each partner, which keeps changing with all adjustments (interest, drawings, profits, etc.).