Which item among the following is NOT listed on the credit side of a Realization Account?
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Loan to other parties
The credit side of the Realisation Account takes the external liabilities and provisions transferred to it; the debit side takes the assets. A loan given by the firm to other parties is money due to the firm, an asset, so it is transferred to the debit side.
Option (1) Bank Loan Mortgage — On the credit side. A loan taken from the bank is an external liability.
Option (3) Outstanding expenses — On the credit side. Expenses due but unpaid are a liability of the firm.
Option (4) Provision for doubtful debts — On the credit side. Provisions go to the credit side, while the debtors themselves go to the debit side at their gross value.
NCERT (2026-27 edition):
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