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Solution - Dissolution of a Partnership Firm - Preparation of Realization Account, and Other Related Accounts

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Question

Shanti and Satya were partners in firm in a sharing profit in the ratio of 4:1. On 31st march ,2013 their Balance Sheet was as follows:

                     Balance Sheet of Shanti and Satya as on 31st March, 2013

LiabilitiesAmount(Rs.)AssetsAmount(Rs.)

Creditors

Workman Compention Fund

Satya’s Current Account

Capital’s:

        Shanti

        Satya

 

45,000

40,000

65,000

 

2,00,000

1,00,000

 

Bank

Debtors

Stock

Furniture

Machinery

Shanti’s Current Account

 

55,000

60,000

85,000

1,00,000

1,30,000

20,000

 

 4,50,000 4,50,000

On the above date the firm was dissolved:

1. Shanti took over 40% of the stock at 10% less than its book value and the remaining stock was sold for Rs.40,000. Furniture realized Rs.80,000.

2. An unrecorded investment was sold for Rs.20,000. Machinery was sold at a loss of Rs.60,000.

3. Debtors realized Rs.55,000.

4. There was an outstanding bill for repairs for which Rs.19,000 were paid.

Prepare Realisation Account.

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Solution for concept: Dissolution of a Partnership Firm - Preparation of Realization Account, and Other Related Accounts. For the courses 12th CBSE (Arts), 12th CBSE (Commerce), 12th CBSE (Science)
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