Question

Distinguish between the drawing account and the current account of a partner.

Answer 1

Sr. No.	Drawing Account	Current Account
1.	Drawing Account records only the amounts withdrawn by a partner from time to time for personal use.	Current Account records all transactions between the firm and the partner, such as interest on capital, salary, share of profit or loss, drawings, interest on drawings, etc.
2.	Drawing Account may be maintained whether the capital system is fixed or fluctuating.	Current Account is maintained only under the fixed capital system.
3.	Drawing Account generally shows a debit balance, as it represents drawings made by the partner.	Current Account may show either a debit or a credit balance.
4.	At the end of the accounting year, the drawing account is closed by transferring its balance to the partner’s capital account.	The balance of the current account is shown in the balance sheet as part of the partner’s capital.