A paid firms liability of Rs 14000 from his personal bank account. What will happen in As capital or current account?

Correct answer: Credit in As account

Direct answer: Option A, credit in A’s account. The liability belonged to the firm, but partner A paid it from personal money. This means A has provided money to the firm and the firm now owes A, so A’s claim increases. Step by step: first identify the nature of payment—it settles a firm liability, not A’s personal expense; next identify the source—A’s private bank account; therefore the firm has received a benefit from A; finally record a credit in A’s capital account under the fluctuating method or in A’s current account under the fixed-capital method. Option A is correct. Option B, debit, would reduce A’s claim and would be suitable for personal withdrawals, not payment of a firm liability. Option C, drawings, is wrong because the payment was for business. Option D, no effect, is wrong because the firm’s liability was settled and A became entitled to reimbursement. Exam cue: partner pays firm expense or liability personally—credit the partner.