The realisation account is the account prepared at the time of the dissolution of the partnership firm. It records the value at which the assets of the firm are realised in cash and the value at which liabilities are paid off. The balance of the realisation account is distributed among the partners in their profit sharing ratio. It is a nominal account opened with the purpose of ascertaining the profit or loss due to the realisation of the assets and liabilities.
Final answer:
It is a nominal account, prepared at the time of dissolution of the partnership firm to record the realised value of assets and liabilities.