A is to receive fixed ₹5000 for realisation expenses. Actual expenses are ₹6500. If A must bear the expenses himself then how much is credited to A?

Correct answer: ₹5000

The governing concept is a fixed remuneration arrangement for realisation work. When the agreement states that A will receive a fixed ₹5,000 and A must bear the actual realisation expenses personally, the credit to A is the agreed remuneration only. Therefore, A’s capital account is credited with ₹5,000, so option A is correct. The actual expense of ₹6,500 is paid by A from personal funds and is not added to the amount credited by the firm. Option B incorrectly treats the actual expense as the credit, option C adds the two amounts, and option D represents only the excess expense of ₹1,500. The excess is A’s personal burden under the stated condition.