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प्रश्न
Sun and Kiran are partners sharing profits and losses equally. They decided to dissolve their firm. Assets and Liabilities have been transferred to Realisation Account. Pass necessary Journal entries for the following:
- All partners are agreed that the process of realisation at the time dissolution will be accomplished by Sun for which he will be paid ₹ 10,000 along with the amount of expense which amounted to 2% of total value realised from the Assets on dissolution. Some assets were sold for Cash at a cumulative Value of ₹ 12,00,000 and the remaining were taken over by creditors at a valuation of ₹ 3,00,000.
- Deferred Advertisement Expenditure A/c appeared in the books at ₹ 28,000.
- Out of the Stock of ₹ 1,20,000; Kiran (a partner) took over 1/3 of the stock at a discount of 25% and 50% of remaining stock was took over by a Creditor of ₹ 30,000 in full settlement of his claim. Balance amount of stock realized at ₹ 25,000.
- An outstanding bill for repairs and renewal of ₹ 3,000 was settled through an unrecorded asset which was valued at ₹ 10,000. Balance being settled in Cash.
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उत्तर
| Date | Particulars | LF | Dr. (₹) | Cr. (₹) |
| a) | Realisation A/c ...Dr | 40,000 | ||
| To Sun’s Capital A/c | 40,000 | |||
| (Being Remuneration and expenses payable to Sun) | ||||
| b) | Sun’s Capital A/c ...Dr | 14,000 | ||
| Kiran’s Capital A/c ...Dr | 14,000 | |||
| To Deferred Advertisement Suspense A/c | 28,000 | |||
| (Being Advertisement Suspense A/c has been debited in partner’s capital account in their profit sharing ratio) | ||||
| c) (1) | Kiran’s Capital A/c ...Dr | 30,000 | ||
| To Realisation A/c | 30,000 | |||
| (Being 1/3 of Stock has been taken over by Kiran at 25% discount) | ||||
| c)(2) | No Entry | |||
| c)(3) | Bank A/c ...Dr | 25,000 | ||
| To Realisation A/c | 25,000 | |||
| (Being Stock Realised) | ||||
| d) | Cash/Bank A/c ...Dr | 7,000 | ||
| To Realisation A/c | 7,000 | |||
| (Being amount realised from unrecorded assets after payment of outstanding bill) |
संबंधित प्रश्न
An account opened to find out the profit or loss on sale of assets and settlement of liabilities.
E and F were partners in a firm sharing profits in the ratio of 7:3. On 28-2-2016 the firm was dissolved. After transferring assets (other than cash) and outsider's liabilities to realization account you are given the following information:
(a) A creditor for Rs 3, 00,000 accepted building valued Rs 3, 75,000 and paid the firm Rs 75,000.
(b) A second creditor for Rs 93,000 accepted stock valued at Rs 90,000 in full settlement of his claim.
(c) A third creditor amounting to Rs 60,000 accepted Rs 37,000 in cash and investments of the book value of Rs 40,000 in full settlement of his claim.
(d) Loss on dissolution was Rs 7,000.
Pass necessary journal entries for the above transactions in the books of the firm assuming that all payments were made by cheque.
Prachi, Ritika and Ishita were partners in a firm sharing profits and losses in the ratio of 5 : 3: 2. In spite of repeated reminders by the authorities, they kept dumping hazardous material into a nearby river. The court ordered for the dissolution of their partnership firm on 31st March 2012. Prachi was deputed to realise the assets and pay the liabilities. She was aid Rs 1,000 as the commission for her services. The financial position of the firm was as follows:
| Liabilities | Rs | Assets | Rs |
|
Creditors Investment Fluctuation Fund Capitals Prachi Ritika |
2,00,000 30,000 30,000 40,000 |
Furniture Stock Investments Cash Ishita's Capital
|
37,000 5,500 15,000 9,000 18,000
|
| 84,500 | 84,500 |
Assets and liabilities are transferred to Realisation Account at their ______ value.
Answer in one Sentence only.
Why is Realisation Account opened?
Write the word / term / phrase, which can substitute the following statements.
Debit balance in realisation account.
Give the word/term/phrase which can substitute the following statement.
The account which shows realisation of assets and discharge of liabilities.
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 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.
Select the most appropriate alternative from those given below :
Realisation Account is __________on realisation of assets.
Mahesh, Suresh and Jayesh were partners of the firm. They decided to dissolve the firm on 31st March, 2012. Their Balance Sheet as on that date was as under:
Balance Sheet as on 31st March, 2012
| Liabilities | Amount (Rs) | Assets | Amount (Rs) | |
| Creditors | 18000 | Cash at Bank | 9600 | |
| Loan | 4500 | Sundry Assets | 51000 | |
| Capitals | Debtors | 72600 | 69000 | |
| Mahesh | 82500 | Less : R.D.D. | 3600 | |
| Suresh | 30000 | Stock | 23400 | |
| Jayesh | 21000 | Furniture | 3000 | |
| 156000 | 156000 | |||
The firm was dissolved as follows:
1) Mahesh will accept furniture for Rs 2,000 and agreed accept the debtors of book value of Rs 60,000 at on agreed value of Rs 51,000.
2) Suresh will accept stock at an agreed value Rs 20,000, and Sundry Assets of Book value Rs 24,000 at Rs 23,500.
3) Jayesh will accept remaining Sundry Assets for Rs 25,000 He will further accept the liability of loan along with due interest at 12% p.a.
Interest for three months on this loan was outstanding and was not recorded in the books.
4) Expenses of dissolution were Rs 1,000 and outstanding expenses of Rs 1,200 were to be paid from the firm.
5) The remaining debtors were realised Rs 7,000.
Prepare:
1) Realisation A/c
2) Partner’s Capital A/c
3) Bank A/c
(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 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.
Following is the balance sheet as on 31 st march 2016 of M/s . Jay and Ajay :
Balance sheet as on 31st MArch 2016
| Liabilities | Amount | Assets | Assets | |
| Capital A/cs : | Cash at bank | 18000 | ||
| Jay | 150000 | Stock | 75000 | |
| Ajay | 150000 | Furniture | 90000 | |
| Reserve fund | 30000 | Investment | 30000 | |
| Loan from Jay | 3000 | Machinery | 90000 | |
| Bills payable | 6000 | Buildings | 45000 | |
| Creditors | 30000 | Debtors | 24000 | 21000 |
| Less : R.D.D | 3000 | |||
| 369000 | 369000 | |||
The firm was dissolved on 31st March , 2016 and the assets realised were as under :
(1) Jay look over the investment at ₹ 27600 and Ajay took over the furniture at ₹ 84000.
(2) The assets were realised as follows :
Stock 73500 ;
Debtors 22500 ;
Machinery 84000 ;
Building 42000
(3) The creditors were paid off at a discount of 900 and other liabilities were paid in full.
(4) Dissolution expenses were 4200
(5) Jay and Ajay were sharing profits and losses in the ratio of 3 : 2.
Prepare :
1) Realisation Account
2) Capital Account of all partners
3) Bank Account
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.
Write the word/phrase/term/ which can substitute the following statement.
Expenses incurred on dissolution of firm.
State whether the following statement is True or False with reason.
At the time of dissolution, a loan from the partner will be transferred to Realisation Account.
Insolvent Partner Capital A/c debit side total is ₹ 10,000 and the credit side total is ₹ 6,000. Calculate deficiency.
Leela, Manda, and Kunda are partners in the firm ‘Janki Stores’ sharing Profits and Losses in the ratio of 3:2:1 respectively. On 31st March 2018, they decided to dissolve the firm when their Balance Sheet was as under.
| Balance Sheets as on 31st March 2018. | |||
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| Creditors | 28,800 | Building | 1,02,000 |
| Bills Payable | 21,600 | Machinery | 73,000 |
| Capital A/c’s | Motor Car | 1,67,600 | |
| Leela | 2,27,160 | Goodwill | 45,600 |
| Manda | 1,44,000 | Investment | 62,400 |
| Kunda | 1,08,000 | Debtors | 30,600 |
| Stock | 45,000 | ||
| Bank | 3,360 | ||
| 5,29,560 | 5,29,560 | ||
Leela agreed to take over the Building at ₹ 1,23,600. Manda took over Goodwill, Stock, and Debtors at Book values and agreed to pay Creditors and Bills payable. Motor Car and Machinery realised ₹ 1,51,080 and ₹ 31,680 respectively. Investments were taken by Kunda at an agreed value of ₹ 55,440. Realisation expenses amounted to ₹ 6,800.
Pass necessary entries in the books of ‘Janki Stores.’
Shailesh and Shashank were partners sharing Profits and Losses in the ratio of 3:2. Their Balance Sheet as on 31st March 2019 was as follows.
| Balance Sheets as on 31st December 2019. | |||
| Liabilities | Amount ₹ | Assets | Amount ₹ |
| Capital Account : | Building | 7000 | |
| Shailesh | 10,000 | Plant | 9,000 |
| Shashank | 6,000 | Debtors | 14,000 |
| Current Account : | Stock | 5,000 | |
| Shailesh | 3,000 | Bank | 6,000 |
| Shashank | 2,000 | ||
| Creditors | 17,400 | ||
| Bills payable | 2,600 | ||
| 41,000 | 41,000 | ||
The firm was dissolved on the above date and the assets realised as under.
1. Plant ₹ 8,000, Building ₹ 6,000, Stock ₹ 4,000 and Debtors ₹ 12,000.
2. Shailesh agreed to pay of the Bills Payable.
3. Creditors were paid in full.
4. Dissolution expenses were ₹ 1,400
Prepare Realisation A/c, Partners Current A/c, Partners Capital A/c, and Bank A/c
Name the account opened to find out the Profit or Loss on Sale of Assets and Settlement of Liabilities?
Consider the following statements
Statement 1: "The firm is dissolved automatically, on the retirement all partners."
Statement 2: A firm dissolves on the retirement of a partner.
Consider the following statements
Statement 1: "On dissolution Cash or Bank Account is closed automatically".
Statement 2: This is done because of the double- entry system of book-keeping.
Which of the following does not result into reconstitution of a partnership firm?
Pick the odd one out.
Asha, Usha and Nisha are partners in the firm sharing profits and losses in the ratio of 3 : 2 : 1 respectively. On 31st March, 2019 they decided to dissolve the firm when their Balance Sheet was as under:
| Balance Sheet as on 31st March, 2019 | |||
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| Creditors | 28,800 | Building | 1,02,000 |
| Bills Payable | 21,600 | Machinery | 73,000 |
| Capitol Accounts: | Motor Car | 1,67,600 | |
| Asha | 2,27,160 | Goodwill | 45,600 |
| Usha | 1,44,000 | Investment | 62,400 |
| Nisha | 1,08,000 | Debtors | 30,600 |
| Stock | 45,000 | ||
| Bank | 3,360 | ||
| 5,29,560 | 5,29,560 | ||
The firm was dissolved on the above date and the assets realised as under:
- Asha agreed to take over the Building at ₹ 1,23,600
- Usha took over Goodwill Stock and Debtors at book value and agreed to pay Creditors and Bills payable.
- Motor car and Machinery realised at ₹ 1,51,080 and ₹ 31,680 respectively.
- Investment were taken by Nisha at an agreed value of ₹ 55,440.
- Realisation Expenses amounted to ₹ 6,800.
Prepare:
- Realisation Account
- Partners' Capital Account
- Bank Account
Charu, Dhwani, Iknoor and Paavni were partners in a firm. They had entered into partnership firm last year only, through a verbal agreement. They contributed Capitals in the firm and to meet other financial requirements, few partners also provided loan to the firm. Within a year, their conflicts arisen due to certain disagreements and they decided to dissolve the firm. The firm had appointed Ms. Kavya, who is a financial advisor and legal consultant, to carry on the dissolution process. In the first instance, Ms. Kavya had transferred various assets and external liabilities to Realisation A/c. Due to her busy schedule; Ms. Kavya has delegated this assignment to you, being an intern in her firm. On the date of dissolution, you have observed the following transactions:
- Dhwani’s Loan of ₹ 50,000 to the firm was settled by paying ₹ 42,000.
- Paavni’s Loan of ₹ 40,000 was settled by giving an unrecorded asset of ₹ 45,000.
- Loan to Charu of ₹ 60,000 was settled by payment to Charu’s brother loan of the same amount.
- Iknoor’s Loan of ₹ 80,000 to the firm and she took over Machinery of ₹ 60,000 as part payment.
You are required to pass necessary entries for all the above-mentioned transactions.
Mandar and Prasad are partners in a firm sharing profit & losses in the ratio of 3 : 2. The following is their balance sheet as on 31st March, 2019.
| Liabilities | Amount (₹) | Assets | Amount (₹) | |
| Capital A/c: | Building | 72,000 | ||
| Mandar | 95,000 | Plant & Machinery | 60,000 | |
| Prasad | 1,00,000 | Furniture | 10,000 | |
| Creditors | 4,000 | Debtors | 42,000 | 40,000 |
| Bills Payable | 3,000 | Less: RDD | 2,000 | |
| Bank | 20000 | |||
| 2,02,000 | 2,02,000 |
On 1st April, 2019 Shubham is admitted for 1/2 share on the following terms:
- He paid ₹ 1,00,000 as Capital ₹ 40,000 as his shares of goodwill by RTGS.
- Plant & Machinery revalued at ₹ 48,000.
- Building is taken over by Mandar at ₹ 100,000.
- Reserve for Doubtful Debts (RDD) to be increased upto ₹ 4,000.
- The old partners decided to retain half of the amount of goodwill in the business.
- The old partners decided to sacrifice equally.
Prepare Partners' Capital Account Only and show your working clearly.
Complete the table.
| Creditors | Bills Payable | Third-Party Liabilities |
| ₹ 16,000 | ₹ 12,000 | ? |
Complete the following table:
| Debit side total of Capital A/c |
Credit side total of Capital A/c |
Cash brought by Partner |
| ₹ 51,000 | ? | ₹ 17,000 |
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:
- An unrecorded asset of ₹ 18,000 was taken over by Tina at ₹ 16,000.
- Rina agreed to pay her brother's loan of ₹ 23,000.
- Stock of ₹ 30,000 was taken over by a creditor of ₹ 40,000 in full settlement.
- Expenses of dissolution ₹ 40,000 were paid by Rina.
- Creditors were paid ₹ 18,800 in full settlement of their account of ₹ 20,000.
- Tina's loan of ₹ 15,000 was paid through a cheque.
Pass the necessary journal entries for the following transactions on the dissolution of the partnership firm of Tanay and Mehak after various assets (other than cash) and external liabilities have been transferred to Realisation Account:
- Creditors of ₹ 60,000 accepted stock valued at ₹ 59,000 in full settlement of their claim.
- Tanay agreed to pay off his wife's loan of ₹ 12,000.
- The firm had a debit balance of ₹ 18,000 in the profit and loss account on the date of dissolution.
- An unrecorded liability of ₹ 20,000 was paid by partner, Mehak, at a discount of 10%.
- Tanay's loan of ₹ 4,000 was paid through a cheque.
- Expenses on dissolution amounted to ₹ 11,000 which were paid by Mehak.
On the day of dissolution of the firm ‘Roop Brothers’ had partner’s capital amounting to ₹ 1,50,000 external liabilities ₹ 35,000, Cash balance ₹ 8,000 and P & L A/c (Dr.) ₹ 7,000. If Realisation expense and loss on Realisation amounted to ₹ 5,000 and ₹ 25,000 respectively, the amount realised by sale of assets is ______.
Following is the Balance sheet of Ram, Shyam and Murari as on 31st March, 2023.
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| Capital | Furniture | 10,800 | |
| Ram | 18,000 | Debtors | 72,000 |
| Shyam | 10,800 | Stocks | 86,400 |
| Creditors | 1,44,000 | Cash | 3,600 |
| Ram's Loan | 36,000 | 3,600 | 36,000 |
| 2,08,800 | 2,08,800 |
Due to the inability to pay the creditors, the firm is dissolved, Shyam and Murari cannot pay anything. Ram can contribute only ₹ 5,400 from his private estate. Stock realised ₹ 54,000. Debtors realised ₹ 57,600 and Furniture is sold for ₹ 3,600. Realisation Expenses amounted to ₹ 10,800.
Prepare necessary Ledger account to close the books of the firm.
______ means winding-up of partnership firm.
| 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:
