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easyMCQCUET Accountancy2026Accountancy
1 mark

Which of the following entries correctly records the withdrawal of excess capital by a partner?

  1. A
    Partner's Capital A/c is debited and Cash/Bank A/c is credited
  2. B
    Cash/Bank A/c is debited and partner's capital A/c is credited
  3. C
    Drawings A/c is debited and profit and loss A/c is credited
  4. D
    Profit and loss A/c is debited and Drawings A/c is credited

Solution & Step-by-step Explanation

When capital is withdrawn permanently by a partner, it reduces their equity balance. Therefore, the Partner's Capital Account is debited, and the cash/bank asset decreases, so the Cash/Bank Account is credited.

Practice this question

Try it yourself before checking the explanation above.

Which of the following entries correctly records the withdrawal of excess capital by a partner?
A
Partner's Capital A/c is debited and Cash/Bank A/c is credited
B
Cash/Bank A/c is debited and partner's capital A/c is credited
C
Drawings A/c is debited and profit and loss A/c is credited
D
Profit and loss A/c is debited and Drawings A/c is credited

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