Question

If at the time of admission, there is some unrecorded liability, it will be ______.

Options

• Debited to Revaluation Account

• Credited to Revaluation Account

• Debited to Goodwill Account

• Credited to partners' Capital A/c

Answer 1

If at the time of admission, there is some unrecorded liability, it will be Debited to Revaluation Account.

Explanation:

An unrecorded liability found during a partner’s admission represents an increase in the firm’s liabilities and a corresponding loss. The Revaluation Account is used to record all increases or decreases in the value of assets and liabilities during reconstitution. Since an unrecorded liability is a loss or expense, it is recorded on the debit side of the Revaluation Account.