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Select the Most Appropriate Alternative from Those Given Below and Rewrite the Statement. - Book Keeping and Accountancy

MCQ

Select the most appropriate alternative from those given below and rewrite the statement.

Under fixed capital method, capital account and __________________ account is opened for each partner.

Options

  • partner’s drawings

  • partner’s salary

  • partner’s current

  • partner’s commission

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Solution

Under fixed capital method, capital account and partner’s current account are opened for each partner.

Explanation: Partner’s Current Account is opened for each partner under fixed capital method because under this method, capital of the partners remains fixed, i.e. unaltered. All other transactions, except introduction and withdrawal of capital, such as those relating to interest on drawings and capital, partners’ salary, share of profit etc, are recorded in the Partners’ Current Accounts.

Concept: The Indian Partnership Act 1932
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APPEARS IN

Micheal Vaz Accounts - Book Keeping and Accountancy HSC 12th Standard Maharashtra State Board
Chapter 1 Introduction to Partnership
Exercise | Q 4 | Page 13
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