Partners' Capitals can be Fixed or Fluctuating. Whatever may be the type, the entries will be made as per the following sides:

                                                     Capital/Current Accounts of partners 

Debit Amounts Credit Amounts
To Current A/c (debit)

To Accumulated Losses (shared in old ratio)

To Goodwill (written off or adjusted)

To Asset A/c (asset taken over)

To Revaluation A/c (loss on revaluation)

To Bank A/c (Balancing figure-payment)

To Balance c/d(closing balance)

 By Balance B/d (opening balance)

By Cash/Bank A/c (cash brought by new partner)

By Premium A/c (shared by old partners in Sacrifice Ratio)

By Accumulated Profits (shared in Old ratio)

By Goodwill(adjusted)

By Liability A/c (liability taken over)

By Revaluation A/c (profit on revaluation)

By Bank(Additional capital brought)

                                                                   Cash/Bank account

Debit Amounts Credit Amounts
To Balance B/d (opening balance)

To Asset A/c (Asset sold, if any)

To Liability A/c (borrowed loan, if any)

To New partner’s Capital A/c (Capital)

To Premium A/c(Premium brought)

To Partner’s capital (additional capital brought)

 By Liability A/c (repayment, if any)

By Asset A/c (purchase, if any)

By Partners’ Capital A/c (withdrawal)

By Balance c/d (closing balance)

 

Adjustment of Capitals on admission of Partner

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