Match List-I with List-II

List-I	List-II
(A) Payment of loans due to partners	(I) Realisation A/c Dr To Bank A/c
(B) For settlement of partners' accounts, in case their capital account shows a debit balance	(II) Bank A/c Dr. A/c To loan to partners
(C) For settlement of loan by a firm to a partner	(III) Bank A/c Dr. To Partner's Capital A/c
(D) For settlement of any unrecorded liability	(IV) Partner's Loan A/c Dr. To Bank A/c

Choose the correct answer from the options given below:

Looking at each transaction and its corresponding journal entry during dissolution of partnership:

For (A) - Payment of loans due to partners:

When the firm pays back a loan taken from partners, the Partner's Loan account (a liability) must be closed and cash goes out.

Entry: Partner's Loan A/c Dr. → To Bank A/c

This matches with (IV)

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For (B) - Settlement of partners' accounts with debit balance:

A debit balance in capital account means the partner owes money to the firm. When settling, the partner brings in cash.

Entry: Bank A/c Dr. → To Partner's Capital A/c

This matches with (III)

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For (C) - Settlement of loan by firm to a partner:

When a partner returns the loan they had taken from the firm, cash comes in and the loan asset is reduced.

Entry: Bank A/c Dr. → To Loan to partners A/c

This matches with (II)

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For (D) - Settlement of unrecorded liability:

Unrecorded liabilities discovered during dissolution are paid through Realisation Account, as all dissolution-related payments are routed through it.

Entry: Realisation A/c Dr. → To Bank A/c

This matches with (I)

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Therefore, the correct matching is: (A)-(IV), (B)-(III), (C)-(II), (D)-(I)

Correct Answer: Option 1