Revaluation

Step 1: Nature of Revaluation A/c.
At admission, retirement, or death of a partner, assets and liabilities are revalued. All changes are recorded in Revaluation A/c.
Step 2: Profit/Loss Adjustment.
Any profit (increase in assets or decrease in liabilities) or loss (decrease in assets or increase in liabilities) is transferred to old partners’ capital accounts.
Step 3: Conclude.
Therefore, Revaluation A/c is similar to a Profit and Loss Adjustment A/c.
Final Answer:

Step 1: Understand the balance of Revaluation A/c.
- Debit side records decreases in asset values or increase in liabilities (losses).
- Credit side records increases in asset values or decrease in liabilities (gains).
Step 2: Interpretation of excess credit.
When the credit side is greater than the debit side, it means gains are more than losses, i.e., net profit on revaluation.
Step 3: Conclude.
Thus, excess of credit side over debit side is called “Profit”.
Final Answer:

Step 1: Nature of accounts.
- Personal A/c relates to persons or firms.
- Real A/c relates to assets and properties.
- Nominal A/c relates to incomes, expenses, gains, and losses.
Step 2: Purpose of Revaluation Account.
Revaluation Account is prepared at the time of admission, retirement, or death of a partner to record the revaluation of assets and liabilities.
Step 3: Type of entries.
Revaluation Account records gains (credits) and losses (debits). Since it includes expenses and incomes, it is treated as a nominal account.
Step 4: Conclude.
Therefore, Revaluation Account is a Nominal Account.
Final Answer: