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easyMCQCUET Accountancy2026Accountancy
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On dissolution of a firm, bank overdraft is transferred to:

  1. A
    Cash Account
  2. B
    Bank Account
  3. C
    Realisation Account
  4. D
    Partner's Capital Account

Solution & Step-by-step Explanation

During the dissolution of a partnership firm, a bank overdraft is treated as an external financial liability of the firm. Like all other third-party external liabilities, it must be closed out by transferring it to the credit side of the Realisation Account.

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On dissolution of a firm, bank overdraft is transferred to:
A
Cash Account
B
Bank Account
C
Realisation Account
D
Partner's Capital Account

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