If the debit balance of the Profit and Loss Account is ₹24,000 and A and B share profits in the ratio of 3:1, how much will be debited to A’s Capital Account?

Correct answer: Debit ₹18,000

A debit balance in the Profit and Loss Account represents an accumulated loss, so it is debited to the partners’ Capital Accounts in their profit-sharing ratio. A’s share is \(3/(3+1)=3/4\). Therefore, the amount debited to A’s account is ₹24,000 × \(3/4\) = ₹18,000. ₹6,000 is B’s share, not A’s. Exam tip: accumulated losses are debited to partners’ Capital Accounts, whereas accumulated profits are credited.