In partnership under fluctuating capital account method, recording the transactions relating to drawings, interest on capital, commission, salary, share of profit or loss are made in.

Partner's Capital Account

Right on! Give the BNAT exam to get a 100% scholarship for BYJUS courses

Partner's Current Account

No worries! We‘ve got your back. Try BYJU‘S free classes today!

A or B

No worries! We‘ve got your back. Try BYJU‘S free classes today!

A & B

No worries! We‘ve got your back. Try BYJU‘S free classes today!

Open in App

Solution

The correct option is A Partner's Capital Account
Fluctuating capital system states that any appropriation in profit are to shown through capital only so that a clear picture of fluctuations in capital can be shown. And for this only a single partners' capital account is prepared.
Various appropriations like interest on capital, drawings, commission and share in profit and loss are thus to be recorded in partners' capital account to show the fluctuations in capital.

Suggest Corrections

Similar questions

Q. If interest on capital, salary to the partner and share of profit are credited while interest on drawings, drawings and share of loss are debited to the Partners' Capital Accounts, what is the method followed to maintain the Capital Accounts?

Under ___ Method, all adjustments for drawings, salary, interest on capital, salary interest on capital, etc. are made in the capital account.

Q. Show how the following will be recorded in the Capital Accounts of the Partners Sohan and Mohan when their capitals are fluctuating:

	Sohan (Rs.)	Mohan (Rs.)
Capitals on 1st April, 2017	4,00,000	3,00,000
Drawings during 2017-18	50,000	30,000
Interest on Capital	5%	5%
Interest on Drawings	1,250	750
Share of Profit for 2017-18	60,000	50,000
Partner's Salary	36,000	....
Commission	5,000	3,000

Q. In case of fixed capital accounts, transactions such as drawings, commission are recorded in a separate account called account.

Anubha and Kajal are partners of a firm sharing profits and losses in the ratio of 2 : 1. Their capital, were Rs 90,000 and Rs 60,000. The profit during the year were Rs 45,000. According to partnership deed, both partners are allowed salary, Rs 700 per month to Anubha and Rs 500 per month to Kajal. Interest allowed on capital @ 5% pa. The drawings at the end of the period were Rs 8,500 for Anubha and Rs 6,500 for Kajal. Interest is to be charged @ 5% pa on drawings. Prepare partners capital accounts, assuming that the capital account are fluctuating.

Join BYJU'S Learning Program