Bs current account opened with Rs 12000 credit. Commission is Rs 8000 loss share Rs 10000 drawings Rs 9000 and interest on drawings Rs 1000. What is the closing balance?

Correct answer: Nil balance

The correct answer is option A, nil balance. A current account records items that increase or decrease a partner's balance after the capital account has been considered. A credit balance of Rs 12,000 is the opening credit. Commission of Rs 8,000 is also a credit, so total credits are Rs 20,000. The loss share of Rs 10,000 is a debit, drawings of Rs 9,000 are a debit, and interest on drawings of Rs 1,000 is another debit. Total debits are Rs 10,000 + Rs 9,000 + Rs 1,000 = Rs 20,000. Since credits equal debits, the closing balance is zero. Option B is wrong because there is no excess credit of Rs 20,000; that amount is the total credit, not the closing balance. Option C is wrong because debits do not exceed credits. Option D is wrong because the figures do not leave a Rs 10,000 debit. The exam rule is: add each side separately, then compare the totals.