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If A interest on capital of three thousand rupees is wrongly credited to capital account under fixed capital method what correction is needed?

Answer and explanation

Correct answer: Remove from capital account and credit current account

Under fixed capital method interest should go to current account. If kept in capital account it wrongly increases capital.

Related tags

Fixed CapitalInterest CorrectionErrorCapital AccountsPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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