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Book Value of Assets (Other than Cash and Bank) Transferred to Realisation Account Is ₹ 1,00,000. 50% of the Assets Are Taken Over by a Partner Atul, at a Discount of 20% - Accountancy

Numerical

Book Value of assets (other than cash and bank) transferred to Realisation Account is ₹ 1,00,000. 50% of the assets are taken over by a partner Atul, at a discount of 20%; 40% of the remaining assets are sold at a profit of 30% on cost; 5% of the balance being obsolete, realised nothing and remaining assets are handed over to a Creditor, in full settlement of his claim.
You are required to record the Journal entries for realisation of assets.

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Solution

Journal

Date

Particulars

L.F.

Amount

(₹)

Amount

(₹)

 

Realisation A/c

Dr.

 

1,00,000

 

 

To Sundry Assets A/c

     

1,00,000

 

(All assets other than cash and bank transferred to Realisation Account)

     

 

Atul’s Capital A/c

Dr.

 

40,000

 

 

To Realisation A/c

     

40,000

 

(Atul took over 50% of assets worth Rs 1,00,000 at 20% discount)[1,00,000 @ 50% @ 80%]

     

 

Bank A/c

Dr.

 

26,000

 

 

To Realisation A/c

     

26,000

 

(Assets worth Rs 20,000, i.e. 40% of assets of Rs 50,000 are soldat a profit of 30%) [50,000 × (40/100) × (130/100)]

     

 

No entry for obsolete assets and for the assets givento the creditors in the full settlement as these are already transferred tothe Realisation Account)

       
Concept: Dissolution of a Partnership Firm - Settlement of Accounts
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APPEARS IN

TS Grewal Class 12 Accountancy - Double Entry Book Keeping Volume 1
Chapter 7 Dissolution of a Partnership Firm
Exercise | Q 13 | Page 53
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