If realisation expenses are paid by partner on behalf of the firm journal entry would be :
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → Realisation A/c Dr To partner's capital A/c
Realisation expenses are a cost of winding up the firm, so they are debited to Realisation Account. The firm has not paid them; a partner has paid them for the firm, so the firm owes him that amount and his capital account is credited.
Realisation A/c … Dr.
To Partner’s Capital A/c
NCERT (2026-27 edition):
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