Partners’ current accounts records amounts payable to the partners/claimable by the partners during or at the end of the financial year. Which one of the following are not recorded in a partner’s current account.

Answer 1

In a partner's current account, certain items are typically recorded to reflect the financial activities involving the partners, including amounts payable to or claimable by the partners. However, there are specific items that are not recorded in a partner's current account.

The following are generally not recorded in a partner's current account:

1. Capital Contributions: The initial investments made by partners in the business are recorded in the partner's capital account, not in the current account.

2. Fixed Assets or Long-Term Investments: Investments in long-term assets are typically not recorded in the current account.

3. Salary or Drawings Payable to Partners: While drawings may affect the balance of a partner’s current account, agreed salaries or guaranteed payments to partners are typically recorded separately as expenses.

4. Liabilities of the Partnership: Any obligations of the partnership itself, such as loans or debts that the partnership holds, are not recorded in individual partners' current accounts.

It’s important to refer to the applicable accounting principles and the partnership agreement to confirm what transactions are recorded in each type of account, as specific practices may vary.