Question

On dissolution of the firm, amount received from sale of unrecorded asset is credited to:- a)Partners capital A/c. b)Profit and loss A/c. c)Cash A/c. d)Realization A/c.


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Answer 1

Answer:

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Explanation:

At the time of dissolution, all the assets are transferred to realisation account. Journal entry is:

Realisation A/c Dr.

To assets A/c

When assets are sold, entry is:

Bank A/c Dr.

To Realisation A/c

Because bank balance increased