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Under fluctuating capital method A capital account shows debit balance of eight thousand rupees. What situation can this indicate?

Answer and explanation

Correct answer: Drawings and losses reduced more than capital

Debit capital balance shows amount may be recoverable from partner. It may arise from excess drawings or heavy losses.

Related tags

Debit BalanceFluctuating CapitalAnalysisCapital AccountsPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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