Question

Name the account opened to find out the Profit or Loss on Sale of Assets and Settlement of Liabilities?

Options

• Realisation Account

• Revaluation A/c

• Both Realisation Account and Revaluation A/c.

• None of the above

Answer 1

Realisation Account

Explanation:

The purpose of the Realisation Account is to determine the profit or loss on asset sales and liability settlements at the time of the firm's dissolution.