Write any six points of differences between Revaluation Account and Realisation Account.

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> [!TLDR]
> Both are nominal accounts used to work out a profit/loss figure, but a Revaluation Account keeps the firm alive while a Realisation Account closes it down for good.
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> **Six points of difference between Revaluation Account and Realisation Account:**
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> 1. **Occasion of preparation:** A Revaluation Account is prepared on **reconstitution** of the firm — i.e., on admission, retirement, or death of a partner — when the firm continues to exist with a changed set of partners. A Realisation Account is prepared only on **complete dissolution** of the firm, when the partnership relationship between all the partners ends and the business is wound up entirely.
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> 2. **Scope of assets/liabilities covered:** The Revaluation Account deals only with those assets and liabilities whose values need to be revised (e.g., stock, provision for doubtful debts, building) — it does not necessarily include every single asset/liability. The Realisation Account deals with **ALL** assets (except cash/bank, and any asset a partner specifically agrees to retain) and **ALL** outside liabilities of the firm, since the whole business is being wound up.
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> 3. **Effect on the books/continuity of the firm:** After a Revaluation Account is prepared, the assets/liabilities are shown at their **revised (new) values** in a fresh Balance Sheet, and the firm **continues its business**. After a Realisation Account is prepared and closed, all assets stand realised and all liabilities stand paid off, and the **firm ceases to exist**.
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> 4. **Frequency:** A Revaluation Account may be prepared **more than once** in the life of a firm — every time there is an admission, retirement, or death. A Realisation Account is prepared only **once** — at the final dissolution — since the firm does not exist thereafter.
> …

Transaction	Debit	Credit
Transfer of all assets (except cash/bank)	Realisation A/c	Respective Asset A/c
Transfer of all external liabilities	Respective Liability A/c	Realisation A/c
Sale of an asset	Bank A/c (cash received)	Realisation A/c
Payment of a liability	Realisation A/c	Bank A/c (cash paid)
Payment of dissolution expenses	Realisation A/c	Bank A/c
When a partner takes over an asset	Partner's Capital A/c	Realisation A/c
When a partner takes over a liability	Realisation A/c	Partner's Capital A/c
Profit on realisation (transferred)	Realisation A/c	Partners' Capital A/c (in PSR)
Loss on realisation (transferred)	Partners' Capital A/c (in PSR)	Realisation A/c

Dr.	Realisation Account		Cr.
Particulars	Amount (₹)	Particulars	Amount (₹)
To Sundry Assets (all transferred)	xxx	By Sundry Liabilities (all transferred)	xxx
To Bank (liabilities paid)	xxx	By Bank (assets sold)	xxx
To Bank (dissolution expenses)	xxx	By Partner's Capital A/c (asset taken over)	xxx

Item	Amount	Side of Realisation A/c
Debtors (gross)	24,500	Debit
Bad debt reserve (provision)	2,500	Credit
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Q.Write any six points of differences between Revaluation Account and Realisation Account.

Concept understanding — Realisation Account

The Realisation Account: Winding Up the Business Books

What the Realisation Account Actually Is

Why It Matters (The "Why")

Accounting Treatment: The Debit and Credit Rules

The Proforma (Format) of the Realisation Account

Q.Write any six points of differences between Revaluation Account and Realisation Account.

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