Question

Write any two items which are not transferred to realization account.

Answer 1

Answer:

Cash account , Reserve fund and partners loan account  are not transferred to realization account.

Explanation:

Cash or Bank Account, Reserve fund  Partners Loan Account, Capital account and Bank overdraft are the accounts are not transferred to Realization Account.

Realization account:

• An account formed upon the breakup of a partnership firm is known as a realization account.
• Calculating profit or loss on the dissolution of a partnership firm is the purpose of creating a realization account.
• To keep track of the sale of these assets and the payment of liabilities, a nominal account called the Realization account.

Cash Account:

• In a cash account, the investor must pay the entire price for any securities they wish to purchase.
• It is prohibited for an investor utilizing a cash account to borrow money from their broker-dealer to pay for transactions in the account.

Reserve Fund:

• An extremely liquid corpus known as a reserve fund gives you the ability to pay for any future, unforeseen bills or debts.
• Typically, a reserve fund is kept as cash in a savings account. This money is accumulated by reoccurring savings.

Partners Loan Account

• When the partnership pays over the excess of the withheld amount over the distributable amount to a taxing body,
• it is referred to as making a partnership loan to the partner.

The profits from the sale of assets are transferred to the realization account.

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