Question

Sonia and Rohit were partners in a firm sharing profits and losses in the ratio of 3 : 2. On 31st March, 2023 their Balance Sheet was as follows:

Balance Sheet of Sonia and Rohit as at 31st March, 2023
Liabilities	Amount (₹)	Amount (₹)	Assets	Amount (₹)	Amount (₹)
Capitals:		1,60,000	Building		2,00,000
Sonia	70,000		Machinery		1,40,000
Rohit	90,000		Furniture		80,000
General Reserve		80,000	Debtors	1,25,000	1,20,000
Sonia’s Loan		1,30,000	Less: Provision	5,000
Bank Loan		2,20,000	Stock		60,000
Creditors		70,000	Cash at Bank		60,000
		6,60,000			6,60,000

The firm was dissolved on the above date on the following terms:

1. Machinery Realised at 80% and furniture was realised at 60% less than book value.
2. Debtors of ₹ 5,000 proved bad and remaining debtors realised 90% only.
3. Creditors took away half of the stock in full settlement of their account.
4. Remaining stock realised ₹ 72,000.
5. Realisation expenses amounting to ₹ 14,000 were paid by Rohit.

Prepare Realisation Account.

Hints:

1. Building will be realised at book value and Bank Loan will be paid at book value.
2. There will be no entry for half of stock taken away by creditors in full settlement of their claim.

Answer 1

Dr.	Realisation A/c			Cr.
Particulars	Amount (₹)	Particulars	Amount (₹)	Amount (₹)
To Sundry Assets:		By Sundry liabilities		2,90,000
Building	2,00,000	Bank loan	2,20,000
Machinery	1,40,000	By Creditors	70,000
Furniture	80,000	By Bank A/c		5,24,000
Debtors	1,20,000	Building	2,00,000
Stock	60,000	Machinery	1,12,000
To Bank A/c	2,20,000	Debtors	1,08,000
To Rohit’s Capital A/c	14,000	Furniture	32,000
		Stock	72,000
		By Loss on Realisation t/f to Capital A/c:		20,000
		Sonia	12,000
		Rohit	8,000
	8,34,000			8,34,000