Question :
Which of the following statements is correct in relation with expenses on revaluation account?
Option 1: Expenses may be incurred by the firm to give effect to the change in profit-sharing ratio.
Option 2: These expenses may be incurred as remuneration to a partner or as payment to an outside party for rendering services.
Option 3: The expenses so incurred are debited to Revaluation Account being expenses relating to reconstitution of the firm.
Option 4: All of the above
Correct Answer: All of the above
Solution : Answer = All of the above
All of the above statements are correct. Expenses on a revaluation account may occur due to adjustments in profit-sharing ratios, which could involve paying remuneration to partners or outside parties for their services. These expenses are debited to the Revaluation Account as they relate to the reconstitution of the firm. Hence, the correct option is 4.
An increase in the value of assets at the time of retirement of a partner is
Option 1: credited to Revaluation Account.
Option 2:
debited to Revaluation Account.
Option 3: debited to Profit and Loss Account.
Option 4:
debited to Profit and Loss Appropriation Account.
On the retirement of a partner, unrecorded liabilities are
Option 1: debited to Revaluation Account.
credited to Revaluation Account.
Option 3: credited to Partner's Capitai Aceount.
Option 4: debited to Profit and Loss.
Question : On the retirement of B, The building of the partnership firm whose book value was Rs 25,000 was valued at Rs 18,000. The treatment will be
Option 1: Rs 18,000 will be debited to revaluation account
Option 2: Rs 7,000 will be debited to revaluation account
Option 3: Rs 8,000 will be credited to revaluation account
Option 4: Rs 7,000 will be credited to revaluation account
A computer purchased on 1st October 2016 for Rs.40,000 debited to Office Expenses Account is to be brought into account on 31st March 2018 charging depreciation @10% p.a. on written down value basis.
Option 1: Revaluation debited by Rs 34,200
Option 2: Revaluation credited by Rs 34,200
Option 3: Revaluation debited by Rs 40,000
Option 4: None of the above
A liability for a claim, included in creditors for Rs.20,000 is settled at Rs.16,000. The revaluation account will be -----
Option 1: Debited by Rs 4,000
Option 2: Credited by Rs 4,000
Option 3: No effect on revaluation account
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