In partnership dissolution, an asset taken over by a partner is debited to?
Question 1 Report
In partnership dissolution, an asset taken over by a partner is debited to?
Answer Details
In partnership dissolution, an asset taken over by a partner is debited to the partner's capital account and credited to the asset account.
When a partner takes over an asset, it means that they are buying the asset from the partnership. Therefore, the value of the asset needs to be removed from the partnership's books and credited to the partner's capital account, which represents the partner's share in the partnership.
At the same time, the asset account needs to be credited to reflect that the asset has been transferred out of the partnership's ownership and into the ownership of the individual partner.
The realization account is used to record the gain or loss that arises from the sale of partnership assets during dissolution. It is not directly involved in the accounting for the transfer of assets to individual partners.
Therefore, the correct answer is that an asset taken over by a partner is debited to the partner's capital account and credited to the asset account.
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