Question

A firm has an unrecorded liability for workmen compensation of ₹ 10,000: The firm was not prudent enough to create a workmen compensation reserve. How will this liability be treated in the books of the firm at the time of retirement of a partner?

Options

• By debiting it to the capital accounts of all the partners.

• By crediting it to Revaluation A/c

• By debiting it to Revaluation A/c

• By debiting it to Workmen Compensation Reserve A/c

Answer 1

By debiting it to Revaluation A/c