Difference between Fixed Capital Account and Fluctuating Capital Account
Difference
between Fixed Capital Account and Fluctuating Capital Account
Basis |
Fixed
Capital Account |
Fluctuating
Capital Account |
1. No Of Accounts
Maintained |
Two accounts are maintained for each partner: Fixed Capital
Account and Current Account. |
Only one account (viz., Capital Account) is maintained for each
partner. |
2. Frequency of Change |
Balance in Fixed Capital Account does not change except under
specific circumstances. |
The balance changes frequently from period to period. |
3. Adjustment for
Drawings, etc. |
All adjustments for drawings, interest on drawings, interest on
capital, salary, share of profit/loss are made in Current Account. |
All adjustments for drawings, interest on drawings, interest on
capital, salary, share of profits and losses are made in Capital Account. |
4. Balance |
It always shows credit balance in Capital Account. |
Fluctuating Capital Account can also show debit balance. |
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