Determine Gain/Loss on Realisation.

The correct option is Loss 2,40,000.

To determine the Gain or Loss on Realisation, we must understand the fundamental accounting treatment during the dissolution of a partnership firm. When a firm is dissolved, all assets (except cash and bank balances) are transferred to the debit side of the Realisation Account at their book values, and all external liabilities are transferred to the credit side of the Realisation Account at their book values.

Subsequently, the amounts realised from the sale of assets are credited to the Realisation Account, and the payments made to settle external liabilities and realisation expenses are debited to the Realisation Account.

A Realisation Loss occurs when the total debits (representing the book value of assets transferred, liabilities paid, and expenses incurred) exceed the total credits (representing the book value of liabilities transferred and the amounts realised from assets). The formula to calculate this is:

$$\text{Realisation Profit/Loss}=\text{Total Credits}-\text{Total Debits}$$

Given the correct answer of a loss of 2,40,000, this indicates that the total debit balance of the Realisation Account exceeded its credit balance by this exact amount, resulting in a net loss of 2,40,000 which is then transferred to the partners' capital accounts in their profit-sharing ratio.