Question

Which account is debited on payment of dissolution expenses?

Options

• Realisation A/c

• Revaluation A/c

• Both Realisation A/c and Revaluation A/c.

• None of the above

Answer 1

Realisation A/c

Explanation:

The Realisation Account will be deducted when dissolution expenses are paid. These are business expenses that should be covered by the company. When the firm pays such expenses on behalf of a partner, the Capital Account of the Concerned Partner is debited.