Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Dissolution of Partnership Firm

Question:

Which of the following will not be shown in Realisation Account?

Options:

Unrecorded Asset realised

Unrecorded Liabilities paid off

Partner's Loan to the firm

Realisation Expenses

Correct Answer:

Partner's Loan to the firm

Explanation:

The correct answer is option (3) : Partner's Loan to the firm

Loan by a partner to the partnership firm is not an external liability. So, it will not be transferred to the realisation account. It is also not transferred to partner's capital account because it is paid after settling outside liabilities but before payment of capital. The journal entry for this-

Partner's loan A/c Dr.
    To bank A/c