Credits Exclusive to Partner's Capital Account

Steps:

• Credit side records permanent capital increases like initial investments and undistributed profits.
• Item 1 (Goodwill split): Appears on debit side when written off or adjusted downward in partnership changes.
• Item 2 (Opening balances split): Solely initial contributions credited in ratio at partnership formation.
• Item 3 (Revaluation profit): Always credited to capitals in profit-sharing ratio for asset value gains.
• Item 4 (Transfers from current): Can debit capital if transferring out to current account.

Why C is correct:

• Items 2 and 3 only credit capital per partnership accounting rules, reflecting setup and profit shares without reversal potential.

Why the others are wrong:

• A: Includes 1, which debits capital in adjustments.
• B: Includes 1, not exclusive to credits.
• D: Includes 4, which can debit capital.

Final answer: C