Question : Partner's Drawings account is closed.
Option 1: By transfer to the credit side of the capital Account.
Option 2: By transfer to the credit side of the current account.
Option 3: either A or B
Option 4: By transfer to the debit side of the Capital or Current account.
Correct Answer: By transfer to the debit side of the Capital or Current account.
Solution :
Answer =
By transfer to the debit side of the Capital or Current account
.
Partner's drawings account is closed by transfer to the debit side of the capital account or current account.
Partner's capital / current A/C Dr
To Drawings A/C or Cash A/C.
In the case of permanent drawings, it will be recorded in the capital account and temporary Drawings will Be recorded in the current account.
Hence, the correct option is 4.
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