Read the following passage and answer the question.

X & Y are partners sharing profits and losses in the ratio 4:3. They decide to dissolve the firm. On the date of dissolution following information is available-
X's Capital = ₹1,25,030
Y's Capital = ₹2,070
Creditors = ₹23,150
Cash = ₹4,520
Remaining assets realised at ₹1,24,910 and the dissolution expenses are ₹1,860. Both Partners are solvent.

Pass the journal entry for the payment of realisation expenses?

Realisation A/c Dr. ₹1,860
    To Cash A/c                ₹1,860

The correct answer is option 3-
Realisation A/c Dr. ₹1,860
    To Cash A/c                ₹1,860

If some expenses are incurred by the firm during the realisation of assets and payment of liabilities and the firm makes the payment, the entry will be as follows: Realisation Account Dr. To Bank Account
This entry reflects the payment made by the firm to settle the realisation expenses incurred during the dissolution process.
So, here journal entry will be-
 Realisation A/c Dr. ₹1,860
    To Cash A/c                ₹1,860

When no information is given then it is assumed that expenses are paid by the firm itself.