Which item among the following is NOT listed on the credit side of a Realization Account?

Loan to other parties

The correct answer is Option (2) → Loan to other parties

Loan to other parties → Asset → Debited, not credited

On dissolution of a firm, the Realisation Account is prepared to close assets and liabilities.

• Credit side of Realisation A/c includes:

  • All liabilities transferred (like creditors, bills payable, bank loan, mortgage loan, outstanding expenses, provisions, etc.).

  • These are credited because they represent claims against the firm.

• Debit side of Realisation A/c includes:

  • All assets transferred (like debtors, stock, furniture, investments, loan to other parties, etc.), except cash/bank and fictitious assets.