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If realisation expenses are recorded in the Realisation Account at an amount higher than the actual amount, what will be the final effect?

Answer and explanation

Correct answer: रियलाइजेशन लाभ कम होगा या रियलाइजेशन हानि बढ़ेगी

Realisation expenses are debited to the Realisation Account. If they are recorded at more than the actual amount, the debit side increases; consequently, realisation profit decreases or realisation loss increases. Option C is incorrect because a change in the recorded expense directly affects the realisation result. Exam tip: Higher expenses in the Realisation Account mean lower profit or higher loss.

Related tags

Partnership DissolutionRealisation AccountRealisation ExpensesAccounting EntriesProfit And LossDissolution Of A Partnership FirmAccountancyClass 12 Mcq

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