When final cash payment is made to a partner, on which side is it recorded in his capital account?

Correct answer: Debit side

The direct answer is option A, the debit side. At dissolution, when the firm makes the final cash payment to a partner, the partner's claim against the firm is settled. A partner's capital account normally has a credit balance representing the amount payable by the firm. To close or reduce that credit balance, the account is debited. The cash account is credited because cash leaves the firm, but the question asks specifically about the partner's capital account. Option A is correct. Option B, the credit side, would increase the amount owed to the partner and is opposite to the effect of payment. Option C, Realisation Account, is wrong because the final payment is recorded through the partner's capital account and cash or bank account, not as a realisation expense. Option D, Trading Account, is irrelevant because trading account records gross profit or loss from normal trading, not dissolution settlement. Memory cue: payment to a partner reduces the firm's payable balance, so debit the partner's capital account and credit cash or bank.