For transferring the revaluation loss, which of the following is correct ?
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Revaluation account is credited
A loss on revaluation leaves the Revaluation A/c with a debit balance. To close it, the loss is passed on to the old partners in their old ratio: their capital accounts are debited and the Revaluation A/c is credited.
Old Partners’ Capital A/cs (individually) Dr.
To Revaluation A/c
(Loss on revaluation transferred in the old ratio)
The old partners bear the loss because the fall in values happened while they ran the firm; the new partner’s capital account is not touched.
NCERT (2026-27 edition):
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