Question

The details of sales and purchases of assets like currency, stock, bond etc. are kept in which account?

• A. Current Account
• B. Capital Account
• C. Reserve Account
• D. None of these

Hint:

The Capital Account records transactions involving financial assets and capital transfers.

Answer 1

The Correct Option is B

Step 1: Understanding the different accounts.
In international finance, there are different types of accounts used to record various types of transactions. The Capital Account records transactions related to the purchase and sale of assets, such as financial instruments (currency, stock, bonds, etc.), and capital transfers.

Step 2: Analyzing the options.
(A) Current Account: Incorrect. The current account records transactions related to goods, services, income, and current transfers, not purchases and sales of assets.
(B) Capital Account: Correct. The capital account is used to record the purchase and sale of financial assets like currency, stocks, and bonds.
(C) Reserve Account: Incorrect. The reserve account typically deals with central bank reserves, not the purchase of assets.
(D) None of these: Incorrect, as the correct answer is (B).

Step 3: Conclusion.
The details of sales and purchases of assets like currency, stock, and bonds are recorded in the Capital Account.