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Following is the Balance Sheet of Arvind and Balbir as at 31st March, 2019: - Accountancy

Numerical

Following is the Balance Sheet of Arvind and Balbir as at 31st March, 2019:
 

Liabilities

Amount

(₹)

Assets

Amount

(₹)

Trade Creditors

45,000

Cash 750
Bills Payable 12,000 Bank 12,000
Mrs. Arvind's Loan 7,500 Stock 7,500
Mrs. Balbir's  Loan 15,000 Investments 15,000
Reserve Fund

15,000

Book Debts

30,000

 

Investments Fluctuation  Reserve

1,500

Less: Provision for Doubtful Debts

3,000

27,000

Capital A/cs:   Building   22,500
Arvind

15,000

 

Plant 30,000
Balbir

15,000

30,000

Goodwill

6,000

 

 

 

Profit and Loss A/c

5,250

 

1,26,000

 

1,26,000

 
 The firm was dissolved on the above date under the following arrangement:
(a) Arvind promised to pay off Mrs. Arvind's Loan and took Stock at ₹ 6,000.
(b) Balbir took half the Investments @ 10% discount.
(c) Book Debts realised ₹ 28,500.
(d) Trade Creditors and Bills Payable were due on average basis of one month after 31st March, but were paid immediately on 31st March @ 2% discount per annum.
(e) Plant realised ₹ 37,500; Building ₹ 60,000; Goodwill ₹ 9,000 and remaining Investments ₹ 6,750.
(f) An old typewriter, written off completely from the firm's books, now estimated to realise ₹ 450. It was taken by Balbir at this estimated price.
(g) Realisation expenses were ₹ 1,500.
Show Realisation Account, Capital Accounts of Partners and Bank Account.

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Solution

Realisation Account

Dr.

 

Cr.

Particulars

Amount

Rs

Particulars

Amount

Rs

Stock

7,500

Provision for Doubtful Debts

3,000

Investments

15,000

Trade Creditors

45,000

Book Debts

30,000

Bills Payable

12,000

Building 

22,500

Mrs. Arvid’s Loan

7,500

Plant

30,000

Mrs. Balbir’s Loan

15,000

Goodwill

6,000

Investments Fluctuation Reserve

1,500

Arvind’s Capital A/c (Mrs. Arvind’s Loan)

7,500

Arvind’s Capital A/c (Stock)

6,000

Bank A/c:

 

Balbir’s Capital A/c (Investments 7500 × 90%)

6,750

Trade Creditors

44,925

 

Balbir’s Capital A/c (Unrecorded Typewriter )

450

Bills Payable

11,980

 

Bank A/c:

 

Expense

1,500

 

Book Debts

28,500

 

Mrs. Balbir’s Loan

15,000

73,405

Plant

37,500

 

Profit transferred to:

 

Building

60,000

 

Arvind’s Capital A/c

23,522.50

 

Goodwill

9,000

 

Balbir’s Capital A/c

23,522.50

47,045

Investments

6,750

1,41,750

 

2,38,950

 

2,38,950

 

Partners’ Capital Accounts

Dr.

 

Cr.

Particulars

Arvind

Balbir

Particulars

Arvind

Balbir

Profit and Loss A/c

2,625

2,625

Balance b/d

15,000

15,000

Realisation A/c (Assets)

6,000

7,200

Realisation A/c

7,500

Bank A/c

44,897.50

36,197.50

Reserve Fund

7,500

7,500

 

 

 

Realisation A/c (Profit)

23,522.50

23,522.50

 

53,522.50

46,022.50

 

53,522.50

46,022.50

 

      Bank Account

Dr.

 

Cr.

Particulars

Amount

Rs

Particulars

Amount

Rs

Balance b/d

12,000

Realisation A/c

73,405

Cash A/c

750

Arvind’s Capital A/c

44,897.5

Realisation A/c

1,41,750

Balbir’s Capital A/c

36,197.5

 

1,54,500

 

1,54,500


Working Notes:
 

Creditors

45,000

Less:2% discount for 1 month

(75)

Payment made to Creditors

44,925

Bills Payable

12,000

Less: 2% discount for 1 month

(20)

Payment made for Bills Payable

11,980

Concept: Accounting Treatment of Bill - Journal Entries and Ledger
  Is there an error in this question or solution?
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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 36 | Page 63
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