Partnership

Accounting

Easy

common

When Capital accounts of partners are maintained on the basis of fixed capital method, interest on drawings will be :-

Debited to Partner's Capital Account

Credited to Partner's Current Account

Debited to Partner's Current Account

Credited to Partner's Capital Account

✅ Correct Option: 3

Under the fixed capital method the capital account balance stays unchanged except for fresh capital introduced or permanently withdrawn. All routine items such as drawings, interest on drawings, interest on capital, salary and share of profit pass through the Current Account. Interest on drawings is an income of the firm, so it is debited to the Partner's Current Account.

2026: 29 May Shift 1

Under the Fluctuating Capital Method, how many accounts are prepared for all adjustments like undistributed profits, reserves, etc. related to partners?

2026: 13 May Shift 2

The books of a business showed that the firm's capital employed is Rs. 2,50,000 and the profits for the last five years were: 2021–Rs. 20,000; 2022-Rs. 25,000; 2023-Rs. 27,500; 2024- Rs.35,000 and 2025-Rs. 42,500. What will be the value of Super Profit, when the goodwill valuation is done on the basis of 3 years' purchase of super profits of the business, given that the normal rate of return is 10%.

2026: 31 May Shift 1

Which of the following statement is not true in case of fluctuating capital method under accounting for partnership?

2025: 3 June Shift 2

Neha contributed Rs. 30,000 and Solani Rs. 90,000 as capital. What will be Saloni's share in profits if the partnership agreement is silent?

2025: 26 May Shift 2

The clauses of a partnership deed can be altered with the consent of ______

2023: 20 June Shift 2

Identify the way by which the clauses of partnership deed can be altered.

When Capital accounts of partners are maintained on the basis of fixed capital method, interest on drawings will be :-

Solution

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