Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Dissolution of Partnership Firm

Question:

A loan from partner's relative is transferred to which account at the time of dissolution of partnership firm:

Options:

Realisation A/c

Partner's capital A/c

Partner's loan A/c

None of these

Correct Answer:

Realisation A/c

Explanation:

The loan from a partner relative is just like a loan from a third party so it is a liability of the firm and transferred to realisation account like other liability.
For transfer of liabilities-
All external liability accounts including provisions, if any, are closed by transferring them to the credit of Realisation account.
Liabilities (individually) Dr.
     To Realisation A/c