Question

On 1st April, 2023, A, B and C commenced business in partnership sharing profit and losses in proportion of `1/2, 1/3  "and"  1/6` respectively. They paid into their Bank A/c as their capital ₹ 22,000 being ₹ 10,000 by A, 7,000 by B and ₹ 5,000 by C. During the year they drew ₹ 5,000, being ₹ 1,900 by A, ₹ 1,700 by B and 1,400 by C.

On 31st March, 2024, they dissolved their firm. A taking up stock at an agreed valuation of ₹ 5,000, B taking up furniture at ₹ 2,000 and C taking up debtors at ₹ 3,000. After paying up their creditors, there remained a balance of 1,000 at Bank. Prepare the necessary accounts showing the distribution of the cash at the Bank and of the further cash brought in by any partner as the case required.

Answer 1

Dr.	Realisation A/c			Cr.
Particulars	Amount (₹)	Particulars	Amount (₹)	Amount (₹)
To Sundry Assets	17,000	By A’s Capital A/c		5,000
		By B’s Capital A/c		2,000
		By C’s Capital A/c		3,000
		By Bank A/c		1,000
		By Loss on Realisation t/f to Capital A/c:		6,000
		A	3,000
		B	2,000
		C	1,000
	17,000			17,000

 

Dr.	Partner’s Capital A/c						Cr.
Particulars	A	B	C	Particulars	A	B	C
To Realisation A/c (Loss)	3,000	2,000	1,000	By Balance b/d	8,100	5,300	3,600
To Realisation A/c (Stock taken over)	5,000	-	-	By Bank A/c	-	-	400
To Realisation A/c (Furniture taken over)	-	2,000	-
To Realisation A/c (Debtors taken over)	-	-	3,000
To Bank A/c	100	1,300	-
	8,100	5,300	3,600		8,100	5,300	3,600

 

Dr.	Cash A/c		Cr.
Particulars	Amount (₹)	Particulars	Amount (₹)
To Realisation A/c (Sundry Assets realised)	1,000	By A’s Capital A/c	100
To C’s Capital A/c	400	By B’s Capital A/c	1,300
	1,400		1,400

Working note:

Balance sheet
Liabilities	Amount (₹)	Amount (₹)	Assets	Amount (₹)
Capitals:			By Sundry Assets (Balancing figure)	17,000
A	10,000	8,100
Less: Drawings	1,900
B	7,000	5,300
Less: Drawings	1,700
C	5,000	3,600
Less: Drawings	1,400
		17,000		17,000