The total book value of assets is $25,000 ($5,000 + $20,000). The net cash received is $8,000 ($10,000 sale price - $2,000 realization cost). The loss on realization is $17,000 ($25,000 - $8,000). However, based on the provided answer key, the calculation implies a $13,000 loss. This suggests a potential discrepancy in the provided figures or accounting treatment.

When a partnership is dissolved, all expenses related to the dissolution process are treated as costs of the firm. These expenses are debited to the Realization Account to determine the net gain or loss on realization, and credited to the Bank or Cash account to reflect the outflow of funds from the business.

The total book value of assets is $25,000. Selling them for $10,000 results in a loss of $15,000. Adding the $2,000 realization expense increases the total loss to $17,000. However, based on the provided answer key, the calculation implies a net debit of $13,000, likely accounting for specific asset adjustments or partial realization logic. We report the provided answer as requested.

When a partner takes an asset from the firm during dissolution, the value of that asset is treated as a withdrawal or a reduction in their claim against the firm. Therefore, the partner's capital account must be debited to reflect the decrease in their equity resulting from the receipt of the asset.

Upon the dissolution of a partnership, if a partner takes over an asset of the firm, the value of that asset is treated as a payment to the partner. Since the partner is receiving value from the firm, their capital account must be debited to reflect the reduction in the firm's liability toward that partner. This entry effectively settles the partner's claim against the firm's assets by the amount of the vehicle's value.

During the dissolution of a partnership, all expenses related to the winding-up process are charged to the Realization Account. Since these expenses involve an outflow of cash or bank funds, the Realization Account is debited and the Bank or Cash account is credited.

Upon dissolution, the realization account is used to determine profit or loss on the sale of assets and settlement of liabilities. If a profit is realized, it must be distributed to the partners. Therefore, the realization account is debited to close the profit balance, and the partners' capital accounts are credited to increase their equity.

Upon dissolution, the realization account is used to determine profit or loss on the sale of assets and settlement of liabilities. If a profit is realized, it must be distributed to the partners. Therefore, the realization account is debited (to close the profit balance) and the partners' capital accounts are credited to increase their equity.