After transferring liabilities like creditors and bills payables in the Realisation Account, in the absence of any information regarding their payment, such liabilities are treated as:
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Fully paid
Creditors and bills payable transferred to the Realisation Account are outside liabilities, and these have to be paid before anything goes to the partners. So, unless the question says otherwise, they are taken as paid in full in cash.
NCERT (2026-27 edition):
|
