P, Q and R were partners. On 31st March 2022 their balance sheet showed creditors ₹2,33,000 and debtors ₹4,00,000. On the above date the firm was dissolved. Creditors took over all the debtors in full settlement of their claim. The journal entry for this transaction will be:
1
Debit creditors by ₹2,33,000 and credit debtors by ₹2,33,000
2
Debit creditors by ₹4,00,000 and credit debtors by ₹4,00,000
3
Debit realisation account by ₹2,33,000 and credit debtors account by ₹2,33,000
4
No entry will be passed