Which of the following items will be recorded in Revaluation A/c. (A)…

Which of the following items will be recorded in Revaluation A/c.

(A) Capital brought in by New partner
(B) Plant is to depreciated by 20%
(C) ₹60,000 brought in by new Partner for Goodwill
(D) Stock overvalued by ₹5,000
(E) Unrecorded creditors to the extent of ₹1,500

Choose the correct answer from the options given below:

Answer & explanation

Correct answer: option 4

The correct answer is Option (4) → (B), (D) and (E) Only

The Revaluation Account records only changes in the values of assets and liabilities, including unrecorded ones. Money brought in by the new partner goes to his capital account or to the premium for goodwill.

(A) Capital brought in by New partner — False. It is credited to his capital account; no asset or liability is revalued.

(B) Plant is to depreciated by 20% — True. A fall in the value of an asset is a loss, debited to the Revaluation Account.

(C) ₹60,000 brought in by new Partner for Goodwill — False. Premium for goodwill is credited to the sacrificing partners’ capital accounts.

(D) Stock overvalued by ₹5,000 — True. Reducing stock to its correct value is a loss on revaluation.

(E) Unrecorded creditors to the extent of ₹1,500 — True. An unrecorded liability brought into the books is debited to the Revaluation Account.

NCERT (2026-27 edition):
Revaluation of Assets and Reassessment of Liabilities – “At the time of admission of a new partner, it is always desirable to ascertain whether the assets of the firm are shown in books at their current values. In case the assets are overstated or understated, these are revalued.”

NCERT (2026-27 edition):
Revaluation of Assets and Reassessment of Liabilities – “… The gain or loss on revaluation of each asset and liability is transferred to this account and finally its balance is transferred to the capital accounts of the old partners in their old profit sharing ratio. In other words, the revaluation account is credited with increase in the value of each asset and decrease in its liabilities because it is a gain and is debited with decrease in the value of assets and increase in its liabilities is debited to revaluation account because it is a loss. Similarly unrecorded assets are credited and unrecorded liabilities are debited to the revaluation account.”

NCERT (2026-27 edition):
Revaluation of Assets and Reassessment of Liabilities

Extract from the NCERT textbook