After transferring liabilities like creditors and bills payables to 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
On dissolution, outside liabilities such as creditors and bills payable are transferred to the credit of the Realisation Account and then paid off. When the question says nothing about how they were settled, the firm is taken to have paid them in full, and the payment is debited to the Realisation Account.
NCERT (2026-27 edition):
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