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Under fixed capital method if debit balance of current account is adjusted against partners capital what will be the effect?

Answer and explanation

Correct answer: Capital account will be debited and current account will be credited

To close debit current balance the current account is credited. To reduce partners capital the capital account is debited.

Related tags

Current AccountCapital AdjustmentSet OffCapital AccountsPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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