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Question
Anil and Sunil were partners sharing profits and losses in the ratio of 3: 2. Their Balance Sheet as on 31st March, 2009.
| Balance Sheet as on 31st March, 2009 | |||
| Liabilities | Amount (Rs) | Assets | Amount (Rs) |
| Capital Account: | Bank | 30,000 | |
| Anil | 50,000 | Stock | 25,000 |
| Sunil | 30,000 | Debtors | 70,000 |
| Current Account: | Plant | 45,000 | |
| Anil | 15,000 | Building | 35,000 |
| Sunil | 10,000 | ||
| Creditors | 87,000 | ||
| Bills payable | 13,000 | ||
| 2,05,000 | 2,05,000 | ||
The firm was dissolved on the above date and the assets realised as under:
1) Stock Rs 20,000, Debtors Rs 60,000, Plant Rs 40,000 and Building Rs 30,000.
2) Anil agreed to pay off the bills payable.
3) Creditors were paid in full.
4) Dissolution expenses were Rs 7,000.
Prepare:
(i) Realisation Account
(ii) Bank Account
(iii) Current Account and Capital Account of the partners.
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Solution
In the books of Anil and Sunil
| Dr. | Realisation Account | Cr. | |||
| Particulars | Amount (Rs) | Amount (Rs) | Particulars | Amount (Rs) | Amount (Rs) |
| To Sundry Assets A/c | By Sundry Liabilities A/c | ||||
| Stock | 25,000 | Creditors | 87,000 | ||
| Debtors | 70,000 | Bills payable | 13,000 | 1,00,000 | |
| Plant | 45,000 | Bank A/c: | |||
| Building | 35,000 | 1,75,000 | Stock | 20,000 | |
| Bank A/c: | Debtors | 60,000 | |||
| Creditors | 87,000 | Plant | 40,000 | ||
| Dissolution Expenses | 7,000 | 94,000 | Building | 30,000 | 1,50,000 |
| Anil’s Current A/c | 13,000 | ||||
| Loss transferred to: | |||||
| Anil's Current A/c | 19,200 | ||||
| Sunil's Current A/c | 12,800 | 32,000 | |||
| 2,82,000 | 2,82,000 | ||||
| Dr. | Partners’ Current Accounts | Cr. | |||
| Particulars | Anil | Sunil | Particulars | Anil | Sunil |
| Realisation A/c (Loss) | 19,200 | 12,800 | Balance b/d | 15,000 | 10,000 |
| Capital A/c | 8,800 | - | Realisation A/c (Bills Payable paid off) | 13,000 | - |
| Capital A/c | - | 2,800 | |||
| 28,000 | 12,800 | 28,000 | 12,800 | ||
| Dr. | Partners’ Capital Accounts | Cr. | |||
| Particulars | Anil | Sunil | Particulars | Anil | Sunil |
| Current A/c | - | 2,800 | Balance b/d | 50,000 | 30,000 |
| Bank A/c |
58,800 |
27,200 |
Current A/c |
8,800 |
- |
| 58,800 | 30,000 | 58,800 | 30,000 | ||
| Dr. | Bank Account | Cr. | ||
| Particulars | Amount (Rs) | Particulars | Amount (Rs) |
|
| Balance b/d | 30,000 | Realisation A/c (Liabilities) | 94,000 | |
| Realisation A/c (Assets) | 1,50,000 | Capital A/cs: | ||
| Anil | 58,800 | |||
| Sunil | 27,200 | 86,000 | ||
| 1,80,000 | 1,80,000 | |||
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| Balance Sheet as on 31st March, 2019 | ||||
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| Balance Sheet as on 31st March, 2020 | |||||
| Liabilities | Amount (₹) |
Assets | Amount (₹) |
||
| Capital A/c: | Furniture | 2,000 | |||
| Mukund | 55,000 | 89,000 | Sundry Assets | 34,000 | |
| Sachin | 20,000 | Debtors | 48,400 | 46,000 | |
| Yuvraj | 14,000 | Less: RDD | 2,400 | ||
| Creditors | 12,000 | Stock | 15,600 | ||
| Loan | 3,000 | Cash | 6,400 | ||
| 1,04,000 | 1,04000 | ||||
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Complete the table.
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| ₹ 16,000 | ₹ 12,000 | ? |
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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.
Insolvent partner Capital A/c debit side total is ₹ 25,000 and credit side total is ₹ 10,000. Calculate deficiency.
Mita and Sita, sharing profits in, the ratio 2 : 1, decided to dissolve their partnership firm on 31st March, 2022, on which date their Balance Sheet was as under:
| Balance Sheet of Mita and Sita as on 31st March, 2022 |
|||||
| Liabilities | (₹) | Assets | (₹) | ||
| Sundry Creditors | 40,000 | Land & Building | 29,000 | ||
| Sita's Son's Loan | 2,000 | Plant & Machinery | 20,000 | ||
| Bank Overdraft | 8,000 | Stock | 3,000 | ||
| Capital Accounts: | Debtors | 26,400 | 26,000 | ||
| Mita | 20,000 | 30,000 | Less: Provision for Doubtful Debts |
400 | |
| Sita | 10,000 | Bank | 2,000 | ||
| 80,000 | 80,000 | ||||
The partnership firm was dissolved on the date of the Balance Sheet subject to the following adjustments:
- Trade creditors accepted plant and machinery at an agreed valuation of 10% less than the book value and the balance in cash in full settlement of their claims.
- Debtors of ₹ 1,000 proved bad.
- Sita took over the stock at a discount of 20%.
- Realisation expenses of ₹ 1,100 were paid by the firm.
You are required to prepare the Realisation Account.
Read the following hypothetical situation and answer question on the basis of the same.
|
Nitya, Shreya and Ishita are partners in a firm. They share profit in the ratio of 5 : 3 : 2. Their fixed capital 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 partnership deed provide that interest on capital will be allowed @10% p.a. The amount of interest on Ishita's capital will be:
| 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:
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.
