Partners' current accounts are transferred to respective Partners' _____ Accounts.
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Capital
Under the fixed capital method each partner has a capital account and a current account. On dissolution the books are closed, so the current account balance is transferred to the partner’s capital account; the final amount due to or from each partner is then settled through the capital account.
NCERT (2026-27 edition):
NCERT (2026-27 edition):
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