Accountancy Part AAccounting for Partnership

Debit side of partner's current Account shows : (A) Drawings made out…

Debit side of partner's current Account shows :

(A) Drawings made out of Capital
(B) Interest on Drawings
(C) Share of Loss on Revaluation
(D) Additional Capital Introduced
(E) Adjustment of Goodwill already appearing in Balance Sheet

Choose the correct answer from the options given below :

Answer & explanation

Correct answer: option 2

The correct answer is Option (2) → (B), (C) and (E) Only

A current account is kept only under the fixed capital method. Permanent changes in capital go to the capital account; all other adjustments go to the current account, and those that reduce what is due to the partner are on its debit side.

(A) Drawings made out of Capital — False. A permanent withdrawal of capital is debited to the capital account, not the current account.

(B) Interest on Drawings — True. It is charged to the partner and debited to his current account.

(C) Share of Loss on Revaluation — True. A share of loss reduces the amount due to the partner; with fixed capitals it is debited to the current account.

(D) Additional Capital Introduced — False. Fresh capital is credited to the capital account.

(E) Adjustment of Goodwill already appearing in Balance Sheet — True. Existing goodwill written off is debited to the partners in their old ratio; with fixed capitals it is taken through the current accounts.

NCERT (2026-27 edition):
Maintenance of Capital Accounts of Partners

Extract from the NCERT textbook

NCERT (2026-27 edition):
Treatment of Goodwill – “… If goodwill already appears in the books, it will be written off by debiting all partner’s capital account in their old profit sharing ratio.”