Partners’ current accounts
Partners’ current accounts record drawings and profit allocations separately from fixed capital. Credits normally include salary appropriations, interest on capital and residual profit shares; debits include drawings, interest on drawings and loss shares. The closing balance can be credit or debit. It forms part of the partner’s ownership balance, not an ordinary customer or supplier balance.
Worked example
Opening credit $2,000 plus salary $5,000, capital interest $1,000 and profit share $8,000 less drawings $10,000 and drawings interest $200 gives closing credit $5,800.
Common mistake
A debit current account means the partner’s drawings and charges exceed credits on that account; it is not automatically a business expense.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | K1 | Direct | July 2027–August 2028 |
Related terms
Also called: Partner current account