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A, B, and C were partners sharing profits and losses in the proportion of 2:2:1. Following is their balance sheet as on 31st March, 2013. - Book Keeping and Accountancy

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प्रश्न

A, B, and C were partners sharing profits and losses in the proportion of 2 : 2 : 1. Following is their balance sheet as on 31st March, 2013.
 
Balance sheet as on 31st March, 2013
Liabilities
Amount
(Rs. )
Assets
Amount
(Rs.)
Amount
(Rs.)
Capital Account
 
Machinery
 
25,000
A
30,000
Stock
 
10,000
B
10,000
Debtors
 27,500
 
C
10,000
Less: R.D.D.
1,500
26,000
General Reserve
3,000
Investment
 
12,000
Creditors
20,000
Profit and Loss A/c
 
9,000
A’s Loan Account
4,000
Bank
 
2,000
Bills Payable
7,000
     
 
84,000
   
84,000

On the above date, the partners decide to dissolve the firm.(1)  Assets were realised as -
Machinery Rs. 22,500, Stock Rs. 9,000, Investment Rs. 10,500, Debtors Rs. 22,500
(2) Dissolution expenses were Rs. 1,500.
(3) Goodwill of the firm realised Rs. 12,000
Pass the necessary journal entries int he books of the firm.

रोजनामा प्रविष्टि
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उत्तर

Journal Entries in the books of the firm.
Date Particular   LF Amt(Dr.) Amt(Cr.)
1 For transfer of assets to realisation account:        
   Realisation A/c Dr.     74,500  
  To Machinery A/c          25,000
  To Stock A/c        10,000
  To Debtors A/c           27,500
  To Investment A/c       12,000
           
2.  For transfer of liabilities :        
  Creditors A/c Dr.   20,000  
  Bills Payable A/c Dr.   7,000  
  Reserve for Doubtful Debts A/c Dr.   1,500  
  To Realisation A/c         28,500
           
3. For Assets sold  :        
  Bank A/c Dr.   76,500  
  To Realisation A/c       76,500
           
4.  For payment of liabilities :        
  Realisation A/c Dr.   27,000  
  To Bank A/c         27,000
           
5. For payment of dissolution expenses:        
  Realisation A/c  Dr.   1,500  
   To Bank A/c         1,500
           
6. For distribution of profit among partners :        
  Realisation A/c  Dr.   2,000  
  To A's Capital A/c       8,00
  To B's Capital A/c        8,00
  To C's Capital A/c       4,00
           
7. For payment of loan:        
  A's loan A/c Dr.     4,000  
  To Bank A/c         4,000
           
8. For division of General Reserve:        
  General Reserve A/c Dr.    3,000  
  To A's Capital A/c        1,200
  To B's Capital A/c        1,200
  To C's Capital A/c       6,00
           
9. For division of Debit balance of profit and loss:        
  A's Capital A/c  Dr.    3,600  
  B's Capital A/c  Dr.    3,600  
  C's capital A/c   Dr.     1,800  
  To Profit and loss A/c         9,000
           
10. For payment of capital of partners:        
  A's Capital A/c   Dr.    28,400  
  B's Capital A/c  Dr.    8,400  
  C's Capital A/c  Dr.    9,200  
  To Bank A/c         46,000
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2015-2016 (March)

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संबंधित प्रश्न

Dissolution expenses are credited to ______.


State whether the following statement is True or False with reason.

The debit balance of insolvent partner’s Capital Account is known as a capital deficiency.


Distinguish between 'Dissolution of partnership' and 'Dissolution of partnership firm' on the basis of court's intervention.


Distinguish between 'Dissolution of Partnership' and 'Dissolution of Partnership Firm on the basis of 'Economic Relationship'.


Distinguish between ‘Dissolution of partnership’ and Dissolution of partnership firm ‘on the basis of closure of Books.


Prem and Suresh were partners in a firm sharing profits in the ratio of 7: 8. On 1.4.2015 their firm was dissolved. After transferring assets (other than cash) and outsider's liabilities to realisation account, you given the following information :

(a) Raman, a creditor of  Rs 4, 00,000 accepted land valued at Rs 7,00,000 and paid Rs 3,00,000 to the firm.

(b) Gopal, a second creditor for Rs 1,05,000 accepted  Rs 90,000 in cash and investments of  Rs 14,000 in full settlement of his account.

(c) Hari, a third creditor amounting to Rs 75,000 accepted stock of the book value of Rs 60,000 for Rs 45,000 and the balance was paid to him by cheque.

(d) Loss on dissolution was Rs 45,000.

Pass necessary journal entries for the above transactions in the books of the firm.

 

 


G and H were partners in a firm sharing profits in the ratio of 9: 7. On 1.4.2015 their firm was dissolved. After transferring assets (other than cash) and outsider's liabilities to realisation account you are given the following information :

(a) Mohan, a creditor of Rs 2,30,000 accepted debtors of Rs  2,00,000 at a discount of 10% and the balance was paid to him by cheque.

(b) Sohan, a second creditor for Rs 7,00,000 accepted land of the book value of Rs 10,00,000 at Rs 15,00,000 and paid the balance to the firm by cheque.

(c) Ram, a third creditor for Rs 80,000 took over stock of book value of Rs 40,000 at Rs 30,000 and investments of Rs 48,000 in full settlement of his claim.

(d) Loss on dissolution was Rs 48,000.

Pass necessary journal entries for the above transactions in the books of G and H.


R and L were partners in a firm sharing profits in the ratio of 13:7. On 4-3-2016 their firm was dissolved. After transferring assets (other than cash) and outsiders liabilities to the realization account, you are given the following information :

(a) Subh, a creditor for Rs 4,90,000 accepted building at Rs 6,50,000 and paid the balance to the firm by a cheque.

(b) Sudha, a second creditor for Rs 1, 80,000 accepted machinery of the book value of Rs 1,80,000 at Rs 1,76,000 in full settlement of his claim.

(c) Sudhir, a third creditor for Rs 2,00,000 accepted investments of Rs 1,20,000 and a bank draft of Rs 79,000 in full settlement of his claim.

(d) Loss on dissolution was Rs 30,000. Pass necessary journal entries for the above transactions in the books of the firm


Pass necessary journal entries on the dissolution of a partnership firm in the following cases :

1) Expenses of dissolution were Rs 9,000.

2) Expenses of dissolution Rs 3,400 were paid by a partner, Vishal

3) Shiv, a partner, agreed to do the work for dissolution for a commission of Rs 4,500. He also agreed to bear the dissolution expenses. Actual dissolution expenses Rs 3,900 were paid from the firm's bank account.

4) Naveen, a partner, agreed to look after the dissolution work for which he was allowed a remuneration of Rs 3,000. Naveen also agreed to bear the dissolution expenses. Actual expenses on dissolution Rs 2,700 were paid by Naveen.

5) Vivek, a partner, was appointed to look after the dissolution work for a remuneration of Rs 7,000. He agreed to bear the dissolution expenses. Actual dissolution expenses Rs 6,500 were paid by Rishi, another partner, on behalf of Vivek.

6) Gaurav, a partner, was appointed to look after the work of dissolution for a commission of Rs 12,500. He agreed to bear the dissolution expenses. Gaurav took over furniture of Rs 12,500 as his commission. The furniture had already been transferred to realisation account.


Pass necessary journal entries on the dissolution of a partnership firm in the following cases :

1) Expenses of dissolution Rs 500 were paid by John, a partner.

2) Joney, a partner, agreed to bear the dissolution expenses for a commission of 750. Actual dissolution expenses 650 were paid by Joney

3) Bony, partner agreed to look after the dissolution work for a remuneration of Rs 3,700. He also agreed to bear the dissolution expenses. Actual dissolution expenses Rs 4,200 were paid by Bony from the firm’s cash.

4) Sony, a partner, was appointed to look after the dissolution work for a remuneration of Rs 10,000. Sony agreed to bear the dissolution expenses. Sony took away stock worth Rs 10,000 as his remuneration. The stock had already been transferred to realisation account.

5) Vikky, a partner, agreed to look after the dissolution work for a remuneration of Rs 12,000. Vikky also agreed to bear the dissolution expenses. Actual dissolution expenses Rs 12,500 were paid by another partner, Clive, on behalf of Vikky.

6) Dissolution expenses were Rs 5,000


On dissolution, the cash or bank account is closed automatically.

Moli, Bhola and Raj were partners in a firm sharing profits and losses in the ratio of 3 : 3 : 4. Their partnership deed provided for the following :
(i) Interest on capital @ 5% p.a.
(ii) Interest on drawing @ 12% p.a.
(iii) Interest on partners' loan @ 6% p.a.
(iv) Moli was allowed an annual salary of Rs 4,000; Bhola was allowed a commission of 10% of net profit as shown by Profit and Loss Account and Raj was guaranteed a profit of Rs 1,50,000 after making all the adjustments as provided in the partnership agreement.
Their fixed capitals were Moli : Rs 5,00,000; Bhola : Rs 8,00,000 and Raj : Rs 4,00,000. On 1st April, 2016 Bhola extended a loan of Rs 1,00,000 to the firm. The net profit of the firm for the year ended 31st March, 2017 before interest on Bhola's loan was Rs 3,06,000.
Prepare Profit and Loss Appropriation Account of Moli, Bhola and Raj for the year ended 31st March, 2017 and their Current Accounts assuming that Bhola withdrew Rs 5,000 at the end of each month, Moli withdrew Rs 10,000 at the end of each quarter and Raj withdrew Rs 40,000 at the end of each half year.


Give the word/term/phrase which can substitute the following statement.

Assets which are not recorded in the books of account.


Give the word/term/phrase which can substitute the following statement.

Winding up of partnership business.


Answer in one sentence only.

Who should bear the capital deficiency of an insolvent partner?


Answer in one sentence only.

Which account is debited on repayment of Partner’s Loan?


Write the word / term / phrase, which can substitute the following statements.
Debit balance in realisation account.


Write the word / term / phrase, which can substitute the following statements.
An account opened to find out the Profit or Loss on Sale of Assets and Settlement of Liabilities.


Write the word / term / phrase, which can substitute the following statement.
Conversion of assets into cash on dissolution of firm.


Give the word/term/phrase which can substitute the following statement.

The account which shows realisation of assets and discharge of liabilities.


Write the word / term / phrase, which can substitute the following statement.
Expenses incurred on dissolution of a partnership firm.


State whether the following statements is True or False.

The firm is dissolved automatically on the retirement of a partner.


State whether the following statement is True or False.

On dissolution Cash or Bank Account is closed automatically.


State whether the following statements is True or False.

A Solvent partner having debit balance to his Capital Account does not share the deficiency of Insolvent Partner’s Capital Account.


State whether the following statement is True or False with reason.

Dissolution takes place when the relation among the partners comes to an end.


State whether the following statement is True or False with reason.

The insolvency loss at the time of dissolution of the firm is shared by the solvent partners in their profit sharing ratio.


In case of dissolution assets and liabilities are transferred to ______ A/c.


Select the most appropriate alternative from those given below :

Partnership is compulsorily dissolved when the partners of the firm become ____________


If the number of partners in a firm falls below two, the firm stands_________.


Select the most appropriate alternative from those given below :

All activities of the partnership firm cease (stop) on ____________ of firm.


Pannalal, Babulal and Hiralal were partners sharing profits and losses in the proportion of 2:2:1, following is their Balance Sheet as on 31st March, 2008.

             Balance Sheet as on 31st March, 2008

Liabilities Amount (Rs) Assets Amount (Rs)
Capital Accounts:   Machinery 25000
Pannalal 30000 Stock 10000
Babulal 10000 Debtors 27500 26000
Hiralal 10000 Less : R.D.D 1500
General Reserve 3000

Investment

12000
Creditors 20000 Profit and Loss A/c 9000
Pannalal’s Loan A/c 4000 Bank 2000
Bills payable 7000    
  84000   84000

On the above date the partners decided to dissolve the firm:

1) Assets were realised: Machinery Rs 22,500, Stock Rs 9,000, Investment Rs 10,500, Debtors Rs 22,500.

2) Dissolution expenses were Rs 1,500.

3) Goodwill of the firm realised Rs 12,000

Pass the necessary Journal entries in the books of the firm.


(When all partners become insolvent)

Shiv, Sadashiv and Sadanand are Partners in a firm sharing Profit and Losses equally whose Balance-sheet as on 31st December, 2011 stood as follows:

      Balance Sheet as on 31st December, 2011

Liabilities Amount (Rs) Assets Amount (Rs)
Capital Accounts   Sadanand’s Capital A/c 2000
Shiv 6000 Buildings 18300
Sadashiv 4000

Machinery

12700
Parvati’s Loan 10000

Debtors

9100
Sundry Creditors 30000

Bank

7900
  50000   50000

Shiv, Sadashiv and Sadanand were declared bankrupt and hence the firm was dissolved as on that date:

(i) The sundry Assets realised as follows:

     Building Rs 10,900, Machinery Rs 8,200, Debtors Rs 6,800.

(ii) Realisation expenses amounted to Rs 1,300.

(iii) Sadanand was unable to contribute anything-

Whereas Rs 1,100 and Rs 900 were recovered from the realisation of private estate of Shiv and Sadashiv respectively.

You are required to close the books of the firm.


State the difference between dissolution of partnership and dissolution of partnership firm.


Distinguish between firm’s debts and partner’s private debts.


Explain the process of dissolution of a partnership firm?


State whether the following statement is True or False.

At the time of disolution of a partnership firm all assets should be transfered to realiasation account.


Jay , Ajay and Vijay were partners sharing profits and losses in the proportion of 2 : 2 : 1 . Following is their balance sheet as on 31.03.2013.

Balance sheet as on 31st March 2013

Liabilities Amount (₹) Assets Amount (₹)
Capital A/c   Machinery 50000
Jay 60000 Stock 20000
Ajay 20000 Debtors 55000 52000
Vijay 20000 Less : R.D.D. (3000)
General Reserve 6000 Investments 24000
Creditors 40000 Profit and loss A/c 18000
Jay's Loan A/c 8000 Bank 4000
Bills Payable 14000    
  168000   168000

On the above date the partners decided to dissolve the firm.

(1) Assets were realised as :

Machinery ₹45000 ; Stock ₹ 18000;

Investment ₹ 21000 ; Debtors ₹ 45000

(2) Dissolution expenses were ₹ 3000.

(3) Goodwill of the firm realised ₹ 24000.

Prepare : (1) Realisation Account (2) Partner's Capital Account (3) Bank Account.


Answer the following question:
State any two situations when a partnership firm can be compulsorily dissolved.


Realisation account is __________ on realisation of assets.


Give the word/term/phrase which can substitute the following statement.

Debit balance of Realisation account.


Give the word/term/phrase which can substitute the following statement.

An account opened to find out the Profit or Loss on realisation of Assets and settlement of Liabilities.


Give the word/term/phrase which can substitute the following statement.

Credit balance of realisation Account.


Vinod, Vijay, and Vishal are partners in a firm, sharing profit & Losses in the ratio 3:2:1. Vishal becomes insolvent and his capital deficiency is ₹ 6,000. Distribute the capital deficiency among the solvent partners.


Creditors ₹ 30,000, Bills Payable ₹ 20,000 and Bank Loan ₹ 10,000. Available Bank Balance ₹ 40,000 what will be the amount that creditors will get in case of all partner's insolvency.


Insolvent Partner Capital A/c debit side total is ₹ 10,000 and the credit side total is  ₹ 6,000. Calculate deficiency.


The object of a partnership firm is ______


On dissolution of a firm, a liability taken over by a partner is credited to ______.


Which of the following is the characteristic of a partnership firm?


Which of the following does not result into reconstitution of a partnership firm?


Pass the necessary journal entries for the following transactions on the dissolution of the partnership firm of Tina and Rina after various assets (other than cash) and external liabilities have been transferred to Realisation Account:

  1. An unrecorded asset of ₹ 18,000 was taken over by Tina at ₹ 16,000.
  2. Rina agreed to pay her brother's loan of ₹ 23,000.
  3. Stock of ₹ 30,000 was taken over by a creditor of ₹  40,000 in full settlement.
  4. Expenses of dissolution ₹  40,000 were paid by Rina. 
  5. Creditors were paid ₹ 18,800 in full settlement of their account of ₹  20,000.
  6. Tina's loan of ₹  15,000 was paid through a cheque.

Lal, Bal and Pal were partners sharing profits and losses in the ratio of 2 : 2 : 1. The following is the Balance Sheet as on 31st March, 2020.

Balance sheet as on 31st March 2020
Liabilities Amount (₹) Assets Amount (₹)
Capital A/c   Machinery 50,000
Lal 60,000 Investments 24,000
Bal 20,000 Debtors 55,000 52,000
Pal 20,000 Less: R.D.D. (3,000)
General Reserve 6,000 Stock 20,000
Creditors 48,000 Profit and loss A/c 18,000
Bills Payable 14,000 Bank 4,000
  168000   168000

On the above date the partners decided to dissolve the firm.

(1) Assets were realised as:

Machinery ₹ 45000
Stock ₹ 18000
Investment ₹ 21000
Debtors ₹ 45000

(2) Dissolution expenses were ₹ 3000.

(3) Goodwill of the firm realised ₹ 24000.

Prepare:

  1. Realisation Account
  2. Partner's Capital Account
  3. Bank Account.

Nitya, Shreya and Ishita are partners in a firm. They share profits in the ratio of 5 : 3 : 2. Their fixed capitals are ₹ 1,80,000; ₹ 1,60,000 and ₹ 2,00,000 respectively. For the year ending 31st March, 2022, Nitya withdrew ₹ 7,500 at the end of every quarter.

The average number of months for which interest on drawings will be calculated, will be:


Assertion: A revaluation account is prepared at the time of dissolution of a partnership.

Reason: A revaluation account is prepared to determine the net gain/loss on realisation of assets and settlement of liabilities.

Which one of the following is correct?


A firm having a debtor of ₹ 30,000 from whom the amount was due on 30th June, 2023, gets dissolved on 31st March, 2023. The debtor cleared his dues on the date of dissolution of the firm at a discount of 4% per annum.

Give the journal entry passed by the firm to realise the payment from the debtor.


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