In case of dissolution of the firm, partner's capital account are closed through:
This question was previously asked in
Shift 02/06/2023 3:30 PM - 6:30 PM
A
Bank Account
B
Realisation Account
C
Capital Account
D
Loan Account
Correct Answer
Bank Account
Detailed Explanation
In case of the dissolution of a firm, partner's capital accounts are typically closed through the Bank Account.
The Bank Account is specifically designed for the purpose of closing the capital accounts of partners during the dissolution process. It records the flow of funds in and out of the firm as part of the liquidation process. The ultimate surplus or deficit after realizing assets and settling liabilities is then transferred to the individual partner's Capital Accounts.
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