Question

how to make capital A/C​

Answer 1

Answer:

there are two method of making capital account

1 fixed capital account

2 fluctuating capital account

Answer 2

Answer:

The steps for calculating the partnership capital account are as under:

Step #1 – Credit the capital account with the capital contributed by partners, the share of profit, remuneration of partners, interest on capital, any receipt or asset directly associated with the partner.

Step #2 – Debit the capital account

by drawings, any liability directly related to the partner, etc.

Step #3 – Share of profit is to be distributed in the profit-sharing ratio before calculating closing capital.

Step #4 – Closing capital is to be calculated by reducing the debits from the credits so as to calculate the effective capital contribution.

Step #5 – The closing capital is to be transferred to the balance sheet as a partner capital account.

Explanation: