Accounting JAMB

When the fixed capital method is used; the partners’ share of profits and remunerations are credited to the?

A. current account
B. profit and loss account
C. profit and loss appropriation account
D. capital account

Correct Answer:

Option D – capital account

Explanation

The partnership capital account is an equity account in the accounting records of a partnership. It contains the following types of transactions:

  • Initial and subsequent contributions by partners to the partnership, in the form of either cash or the market value of other types of assets
  • Profits and losses earned by the business, and allocated to the partners based on the provisions of the partnership agreement
  • Distributions to the partners
Sunday

Share
Published by
Sunday
Tags: Accounting

Recent Posts

List of Universities Offering Veterinary Medicine in Nigeria

Veterinary medicine is the branch of medicine that deals with the prevention, diagnosis, and treatment…

3 months ago

List of Universities Offering Anthropology in Nigeria

Anthropology is the scientific study of human beings and their cultures. It encompasses a wide…

3 months ago

List of Universities Offering Sociology in Nigeria

Sociology is the scientific study of human society, culture, and behavior. It examines the social…

3 months ago

List of Universities Offering Social Work in Nigeria

Social Work is a profession dedicated to helping individuals, families, and communities to cope with…

3 months ago

List of Universities Offering Religious Studies in Nigeria

Religious studies is an academic discipline that explores the beliefs, practices, and history of various…

3 months ago

List of Universities Offering Public Administration in Nigeria

Public administration is the field of study and practice that focuses on the organization and…

3 months ago