Debit & credit side of capital a/c of sole proprietor

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Avinash (Querist)
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14 July 2019 I want to prepare Capital A/c of sole proprietor. Kindly tell all possible content of Debit side and Credit Side of Capital A/c of Sole Proprietor. Can i add interest credited on saving or current bank account to credit side of Capital A/c? Also please tell if i Debit following items to Debit side of Capital A/c: Premium on Insurance, Tution Fee, Mutual Fund, PPF etc.? Thanks in advance.

CA Amrita Chattopadhyay

CA Amrita Chattopadhyay

(Expert)
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15 July 2019 I hope that you are doing some business. Interest on current / saving bank would be shown as other income in profit & loss account. You need to prepare Profit & Loss account containing the income or expenditure from business. The profit will be added to the capital account and the drawing that you have made will be deducted from the capital account.

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Avinash

Avinash (Querist)
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15 July 2019 Thank you madam for your reply. Please tell what to do, if i make payment towards insurance policies of my own, mutual fund of my own, own ppf and personal medical expenditure? Can i record it to the debit side of Capital A/c as it is belongs to owner personal level?

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CA Amrita Chattopadhyay

CA Amrita Chattopadhyay

(Expert)
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15 July 2019 Yes, you can record so in the debit side. Your personal expenses can also be shown as drawings and you can maintain a list for drawings.

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Avinash

Avinash (Querist)
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16 July 2019 Thank you Madam. I am grateful to you. I have done Caiptal A/c of sole Proprietor as follows. Please tell tell me is there any correction?
Capital Account
For the Year Ending 31st March 2019

Dr. Side
Particulars Amount Amount
To Drawings 364477
To Life Insurance Premium 78011
To Mediclaim Premium 11360
To Tution Fee 50000

To Balance C/D 671833

Total 1175681

and Credit Side:

Particulars Amount Amount
By Balance B/D 781126
By Net Profit 392460
By Saving Bank Interest
HDFC Bank - 00641000156733 1865
By I Tax Refund 230