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B’s Capital Account has a credit balance of ₹28,000. The total loss on realisation is ₹10,000, and B’s share of the loss is one-half. What amount will remain in B’s Capital Account after adjusting the realisation loss?

Answer and explanation

Correct answer: ₹23,000

B’s share of the realisation loss is ₹10,000 × 1/2 = ₹5,000. This loss is debited to B’s Capital Account, so the remaining balance is ₹28,000 − ₹5,000 = ₹23,000. Exam tip: A realisation loss reduces the partners’ capital balances in their profit-sharing ratio.

Related tags

DissolutionRealisation LossPartner AccountsCapital AdjustmentAccountancyDissolution Of A Partnership FirmClass 12 Mcq

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