Sundry Creditors amounted to ₹5,000. These were paid at a discount of 5%. Realisation account will be debited by what amount?

₹4,750

The correct answer is option 3- ₹4,750.

Creditors = 5,000
Discount = 5%
Discount amount = 5,000 x 5/100
                            = 250
Paid amount to creditors = 5,000 - 250
                                        = 4,750

For payment of liabilities:
Realisation A/c Dr. 4,750
       To Bank A/c         4,750