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Paying off the Debts (Dissolution)

When we pay o...

Question

When we pay off the liabilities, we debit account and credit account.

A

realisation

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B

capital

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C

bank

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D

liability

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Solution

The correct options are
A realisation
C bank
When liability is paid off, the journal entry is-
Realisation A/c Dr.
To Bank A/c.

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Paying off the Debts (Dissolution)

Standard XII Accountancy

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