Credits increase partner's capital

Steps:

• Recall partner's capital account: credits for inflows like contributions, profit share, interest on capital.
• Debits for outflows like drawings, loss share.
• Match choices to items: assume 1=drawings (debit), 2=profit share (credit), 3=interest on capital (credit), 4=loss share (debit).
• Select pair only on credit side: 2 and 3.

Why C is correct:

• Profit share and interest on capital directly increase capital per partnership accounting rules, appearing solely as credits.

Why the others are wrong:

• A includes 1 (drawings, a debit).
• B includes 1 (drawings, a debit).
• D includes 4 (loss share, a debit).

Final answer: C