what is mean by realisation account and why it is prepared in which time I should have the prepared what's the purpose of to prepare of that please explain me the clear view
REALIZATION AC
When the firm is dissolved, its books of a/c are to be closed and the profit or loss arising on realisation of its assets and discharge of liabilities is to be computed.
For this purpose a realisation a/c is prepared to ascertain the net profit or loss of realisation of assets and payment of liabilities which is transferred to partner's capital accounts in their profit sharing ratio.
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