Home › Bihar Board Class 12 (Commerce) › Accountancy › Reconstitution of a Partnership Firm › A reduction in the amount of a liability is a ga…
A reduction in the amount of a liability is a gain and results in a credit to which account?
ARevaluation A/c
BCash A/c here
CCapital A/c here
DReserve A/c here
Answer & Solution
Correct answer: A. Revaluation A/c
The liability account is debited and Revaluation A/c is credited, because the firm owes less than recorded.
Related questions
A, B, C share 5:3:2 and C retires. A and B continue in the old ratio. What is their gaininThe new profit sharing ratio after retirement is the ratio in which whom share future profAccumulated losses at retirement are debited to all partners' capital accounts in which raRetiree's adjusted capital is Rs 60,000 but he is paid Rs 72,000. Hidden goodwill?A retiring partner is paid a lump sum above his adjusted capital. The excess is treated asOn retirement, the goodwill share of the outgoing partner is borne by whom?Annual profit is Rs 1,20,000. A 1/4 partner dies after 3 months. His profit share?The sum due to a retiring partner may include his share of profit up to what date?