Match List-I with List-II
List-I (Amount/Activity at the time of dissolution) List-II (Accounting Treatment) (A) Partner's Loan (I) Is capital loss for the firm (B) Balance of Realisation Account (II) Is debited to realisation account (C) Realisation expenses paid (III) Is not recorded in the realisation account (D) Deficiency of capital account of partner (IV) Is transferred to partner's capital account
Choose the correct answer from the options given below:
Match List-I with List-II
| List-I (Amount/Activity at the time of dissolution) | List-II (Accounting Treatment) |
|---|---|
| (A) Partner's Loan | (I) Is capital loss for the firm |
| (B) Balance of Realisation Account | (II) Is debited to realisation account |
| (C) Realisation expenses paid | (III) Is not recorded in the realisation account |
| (D) Deficiency of capital account of partner | (IV) Is transferred to partner's capital account |
Choose the correct answer from the options given below:
Solution
✅ Correct Option: 1
A partner's loan is settled through a separate account and never enters the Realisation A/c, so (A) matches (III). The closing balance of the Realisation A/c, whether gain or loss, goes to partners' capitals, so (B) matches (IV). Realisation expenses are an expense of realisation and are debited there, so (C) matches (II). An insolvent partner's deficiency is a capital loss borne by the solvent partners, so (D) matches (I).
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