Question

:-statement 1: In the case of fixed capital account profits are transferred to
the bank account.
Statement 2: fluctuating capital account is maintained to record all the entries in a
single account.
Statement 3: in the case of fixed capital account current account is maintained
separately​

Answer 1

Answer:

Capital Accounts: Fixed and Fluctuating

A Capital Account is a general ledger account which shows some of the special transactions like proprietor’s investment in his own business,  the aggregate amount of earning, expenses of companies, etc. There are many more transactions which affect the Capital. Like: Interest on Capital, Interest on Drawings, Salaries to the Partners, Commission for the Partners, etc. These values are put in Profit and Loss Appropriation Account and at the same time credited or debited to their respective Capital Accounts.