On dissolution if a partner undertakes to make payment of a liability of the firm is debited ........

On dissolution, if a partner undertakes to make payment of a liability of the firm is debited)

Profit & Loss Account

Realisation Account

Partner’s Capital Account

Cash Account

- When a partnership firm is dissolved, liabilities need to be settled.

- If a partner agrees to pay off a firm's liability, it's recorded in the firm’s accounts.

- Profit & Loss Account: It captures revenue and expenses over a period, not used for this specific transaction.

- Realisation Account: It serves to settle liabilities and distribute remaining assets; used for dissolution entries.

- Partner’s Capital Account: Reflects each partner’s stake in the firm; shows distribution but doesn’t handle direct liability settlement.

- Cash Account: Records cash transactions, not directly relevant for this liability adjustment.

- Answer: Realisation Account

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