Question
Accountancy Question on Reconstitution of Partnership
Which of the following would affect the Revaluation Account at the time of reconstitution of a partnership firm?
A
Increase in assets
B
Drawings against capital
C
Interest on capital
D
Partner’s salary
Answer
Increase in assets
Explanation
Solution
Increase in assets would be recorded in the Revaluation Account during the reconstitution of a partnership firm.
Hence, the correct answer is Option 1.