On the admission of a new partner, an increase in the value of assets is debited to:
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Assets account
When an asset is revalued upwards on admission, the asset itself must show the higher figure, so the asset account is debited and the Revaluation (Profit and Loss Adjustment) Account is credited with the gain:
Asset A/c Dr.
To Revaluation A/c
The gain on revaluation is later shared by the old partners in their old ratio, so their capital accounts are credited, not debited.
NCERT (2026-27 edition):
|
