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Home Questions UVMTZ4PACF
Target Exam

CUET

Subject

Accountancy

Chapter

Reconstitution of Partnership Firm: Retirement and Death

Question:

How unrecorded assets are treated at the time of retirement of a partner?

Options:

Credited to Revaluation Account

Credited to Capital Account of Retiring Partner

Debited to Revaluation Account

Credited to Partner's Capital Accounts

Correct Answer:

Credited to Revaluation Account

Explanation:

The correct answer is option 1- Credited to Revaluation Account.

Revaluation account is prepared to reassess the assets and liabilities of the firm at the time of retirement or death of a partner. Unrecorded assets will be credited to Revaluation Account at the time of retirement of a partner as it is a gain for the firm. Gain of the firm is credited to revaluation account.

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