Anubha looked after the dissolution work for remuneration of Rs. 8,500 and agreed to bear dissolution expenses upto Rs. 6,000. Actual expenses paid by her were Rs. 7,600. In this case,

(A) Realisation A/c is debited by Rs. 10,100

(B) Anubha's Capital A/c is credited by Rs. 9,600.

(C) Realisation A/c is debited by Rs. 13,600.

(D) Anubha's Capital is credited by Rs. 10100.

Choose the correct answer from the options given below:

Component A: Remuneration

The firm agrees to pay Anubha a flat fee of Rs. 8,500 for her services.

• Impact: This is a direct dissolution cost for the firm.
• Journal Entry:

$\text{Realisation A/c} \quad \text{Dr.} \quad \text{Rs. 8,500}$

$\quad \text{To Anubha's Capital A/c} \quad \quad \text{Rs. 8,500}$

Component B: Dissolution Expenses

• Agreed Cap to Bear: Rs. 6,000
• Actual Expenses Incurred & Paid by Anubha: Rs. 7,600

Since Anubha paid the full Rs. 7,600 out of her own pocket, we must look at how that amount is split based on the agreement:

1. First Rs. 6,000: Anubha agreed to bear this. Since she paid it out of her personal funds, no entry is passed in the firm's books for this portion.
2. Excess Rs. 1,600 (Rs. 7,600 - Rs. 6,000): This is beyond her agreement. Therefore, this Rs. 1,600 is an expense that belongs to the firm, but was paid by Anubha. The firm must credit her capital account to reimburse her.

• Journal Entry for Excess Expenses:

$\text{Realisation A/c} \quad \text{Dr.} \quad \text{Rs. 1,600}$

$\quad \text{To Anubha's Capital A/c} \quad \quad \text{Rs. 1,600}$

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3. Consolidation of Accounts

Now, let's aggregate the debits and credits from both journal entries to see the final ledger impact.

Realisation Account (Debit Side)

• Debited for Remuneration: Rs. 8,500
• Debited for Excess Expenses: Rs. 1,600
• Total Realisation Debit: $\text{Rs. 8,500} + \text{Rs. 1,600} = \mathbf{\text{Rs. 10,100}}$

(This confirms Statement A is true)

Anubha's Capital Account (Credit Side)

• Credited for Remuneration: Rs. 8,500
• Credited for Excess Expenses: Rs. 1,600
• Total Capital Credit: $\text{Rs. 8,500} + \text{Rs. 1,600} = \mathbf{\text{Rs. 10,100}}$

(This confirms Statement D is true)

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4. Why the Alternate Options are Incorrect

• Why Statement (B) is wrong: Crediting Anubha's capital account by Rs. 9,600 assumes the firm only reimbursed her Rs. 1,100 for expenses, which doesn't match the Rs. 1,600 gap over her cap.
• Why Statement (C) is wrong: Debiting Realisation by Rs. 13,600 happens if you incorrectly add the full actual expenses (Rs. 7,600) to the full remuneration (Rs. 8,500) and then subtract the cap—which violates the rule that the first Rs. 6,000 should not hit the firm's books at all.

Therefore, only statements (A) and (D) are correct.