At the time of dissolution of the firm, loan from partners relative is _________ .

transferred to Realisation Account

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not transferred to Realisation Account

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transferred to the Partner's Capital Account

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Non of these

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Solution

The correct option is A transferred to Realisation Account
At the time of dissolution of the firm, loan from partners relative is transferred to the credit side of the Realisation account. Loan from partners relative is part of the external liability of the firm and needs to paid off first. It is not a part of the private debt of the partner and any deficiency needs to be covered up by the partner.

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Is the loan by a partner transferred to Realisation Account at the time of dissolution of a partnership firm? Why?

At the time of dissolution, all the assets of the firm are transferred to Realisation Account at ___________ values.

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