The correct answer is A. Debit Amalgamation Adjustment A/c, Credit Sundry Debtors A/c.
When two companies amalgamate, the assets and liabilities of the two companies are combined into one set of accounts. This means that any intercompany debts or receivables must be eliminated. This is done by debiting the Amalgamation Adjustment account and crediting the relevant account (Sundry Debtors or Sundry Creditors).
The Amalgamation Adjustment account is a temporary account that is used to record the adjustments that are necessary to combine the accounts of the two companies. Once the adjustments have been made, the Amalgamation Adjustment account is closed.
Sundry Debtors is an account that is used to record amounts that are owed to the company by its customers. Sundry Creditors is an account that is used to record amounts that the company owes to its suppliers.
When two companies amalgamate, the intercompany debts and receivables are eliminated. This is done by debiting the Amalgamation Adjustment account and crediting the relevant account (Sundry Debtors or Sundry Creditors). This ensures that the combined accounts of the two companies do not include any intercompany debts or receivables.
Here is an example of an adjustment entry that would be passed to eliminate intercompany owing:
Dr Amalgamation Adjustment A/c 100
Cr Sundry Debtors A/c 100
This entry would eliminate a debt of $100 that one company owes to the other.
I hope this explanation is helpful. Please let me know if you have any other questions.