Out of the following, which items are to be credited to Realisation A/c?
(A) Liabilities transferred
(B) Sales proceeds of assets
(C) Unrecorded assets realised
(D) Realisation expenses
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → (A), (B) and (C) only
On dissolution, the Realisation Account is credited with the liabilities transferred to it and with whatever the firm receives on realisation. It is debited with the assets transferred and with every payment the firm makes in winding up.
(A) Liabilities transferred Correct. External liabilities are closed by transferring them to the credit of the Realisation Account, so they can be settled through it.
(B) Sales proceeds of assets Correct. Cash received on sale of assets is a receipt, so Bank is debited and Realisation A/c credited.
(C) Unrecorded assets realised Correct. An asset the books never showed, such as goodwill, still brings in cash when realised, so the amount is credited to Realisation A/c.
(D) Realisation expenses Incorrect. These are a payment made by the firm, so they are debited to the Realisation Account, not credited.
NCERT (2026-27 edition):
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