In case of dissolution, identify where the unrecorded liabilities whe…

The correct answer is Option (1) → Debit of Realisation account

An unrecorded liability is not in the books, so it was not transferred to Realisation Account. When it is paid on dissolution, the payment is a cost of realisation: Realisation A/c Dr. To Bank A/c. So it appears on the debit side of Realisation Account.

Option (2) Credit of Realisation account — Incorrect. The credit side of Realisation Account records liabilities transferred and assets realised in cash, not liabilities paid.

Option (3) Credit of capital account — Incorrect. A partner’s capital account is credited only when the partner himself takes over or pays a liability.

Option (4) Debit of Bank account — Incorrect. Payment reduces cash, so Bank Account is credited, not debited.