On the ultimate dissolution of a partnership firm, partners' capital accounts are closed finally through which account?
- ARealisation Account
- BDrawings Account
- CBank Account
- DLoan Account
Solution & Step-by-step Explanation
During the dissolution process:Assets and liabilities are transferred to and settled through the Realisation Account.Any profit or loss from realization is transferred to the partners' capital accounts.Finally, the remaining balances in the partners' capital accounts are closed by making final payments to partners or bringing in deficiencies via the Bank Account (or Cash Account).