What will be the treatment, if assets are taken over by a creditor of the firm at the time of dissolution?

The correct answer is: A. Realisation A/c will be debited

When assets are taken over by a creditor of the firm at the time of dissolution, the realisation account is debited with the value of the assets taken over. This is because the realisation account is a nominal account that records the gains and losses on the realisation of the assets of the firm. The credit entry will be made to the creditor’s account.

Here is a brief explanation of each option:

• Option A: Realisation A/c will be debited. This is the correct answer, as explained above.
• Option B: Realisation A/c will be credited. This is incorrect, as the realisation account is a nominal account that records the gains and losses on the realisation of the assets of the firm. It is not a real account that records the assets and liabilities of the firm.
• Option C: No entry should be passed. This is incorrect, as an entry must be passed to record the taking over of assets by a creditor of the firm at the time of dissolution. The entry will be made to the realisation account and the creditor’s account.
• Option D: None of the above. This is incorrect, as option A is the correct answer.