Question

What journal entries will be recorded for the following transactions on the dissolution of a firm:
[a] Payment of unrecorded liabilities of Rs 3,200.
[b] Stock worth Rs 7,500 is taken by a partner Rohit.
[c] Profit on Realisation amounting to Rs 18,000 is to be distributed between the partners Ashish and Tarun in the ratio of 5:7.
[d] An unrecorded asset realised Rs 5,500.

Answer 1

                                    Journal Entries

	Particulars	L.F.	Amount (Rs.)	Amount (Rs.)
a.	Realisation A/c                      Dr.     To Bank A/c (Unrecorded liabilities paid)		3,200	3,200
b.	Rohit’s Capital A/c               Dr.     To Realisation A/c (Stock is taken over by Rohit)		7,500	7,500
c.	Realisation A/c                    Dr.   To Ashish’s Capital A/c   To Tarun’s Capital A/c (Profit on Realisation is transferred to Partners’ Capital Account)		18,000	18,000
d.	Bank A/c                              Dr.       To Realisation A/c (Unrecorded asset sold)		5,500	5,500