A Loss or Gain from Realization account is credited when the assets are sold at a loss during the liquidation process.

Name: A Loss or Gain from Realization account is credited when the assets are sold at a loss during the liquidation process.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

During the liquidation process, if assets are sold at a loss, the Loss on Realization account is debited (not credited) to reflect the decrease in equity resulting from the loss.

A Loss or Gain from Realization Account Is Credited When