If expenses of realisation are paid by the firm in the process of realisation of assets and liability then expenses will be debited to:

Realisation A/c Partner's Capital A/c Partner's Loan A/c Bank A/c

Realisation A/c

The correct answer is Option (1) - Realisation A/c. Realisation A/c Dr.        To cash A/c. This journal entry shows that the realisation expenses are paid by the firm in cash.