CUET Preparation Today
At the time of the Dissolution of a Partnership Firm, which statement is not false? |
The amount of Provision for Debtors is transferred to the Credit Side of the Realisation Account The amount of Provision for Debtors is transferred to the Debit Side of the Realisation Account The amount of Provision for Debtors is transferred to the Credit Side of the Bank Account The amount of Provision for Debtors is transferred to the Credit Side of the Capital Account |
The amount of Provision for Debtors is transferred to the Credit Side of the Realisation Account |
The correct answer is option 1- The amount of Provision for Debtors is transferred to the Credit Side of the Realisation Account. The statement 'The amount of Provision for Debtors is transferred to the Credit Side of the Realisation Account' is not false. When an asset is transferred to realisation account then its corresponding provision or reserve appearing on the liability side is also transferred. The sundry debtors should be transferred at their gross value, and any provision for doubtful debts should be moved to the credit side of the Realisation Account, alongside the liabilities. The same treatment applies to fixed assets if a provision for depreciation account is in use. The journal entry for this- |
