Multiple choice

In case of fixed capital method, the interest on partner's capital is debited to

  1. partner's capital a/c

  2. partner's current a/c

  3. partner's drawing a/c

  4. partner's interest on capital a/c

  5. both 1 and 2
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

In case of fixed capital method, all the adjustments are to be made in the partner's current account. So, interest on partner's capital is debited to partner's current account.

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