Question

Give the necessary Journal entries for the following transactions on dissolution of the firm of Sonu and Monu on 31st March, 2021, after transfer of various assets (other than cash and bank balance) and the third party liabilities to Realisation Account. They shared profits and losses in the ratio of 2 : 1.

1. Sonu agreed to take over the firm's goodwill (not recorded in the books of the firm) at a valuation of ₹ 40,000.
2. Bills payable of ₹ 30,000 falling due on 30th April, 2021 were discharged at ₹ 29,550.
3. Stock worth ₹ 8,00,000 was taken over by partner, Sonu at 10% discount.
4. Creditors off ₹ 2,00,000 accepted machinery valued at ₹ 2,20,000 in full settlement of their claim.
5. Expenses of realisation ₹ 10,000 were paid by partner, Sonu.

Answer 1

In the books of Sonu and Monu Journal Entries
Date	Particulars	L.F.	Amount Dr. (₹)	Amount Cr. (₹)
i.	Sonu's Capital A/c   ...Dr.		40,000	-
	To Realisation A/c		-	40,000
	(Being unrecorded goodwill taken over by Sonu)
ii.	Realisation A/c   ...Dr.		29,550	-
	To Cash A/c		-	29,550
	(Being B/P discharged)
iii.	Sonu's Capital A/c  ...Dr.		7,20,000	-
	To Realisation A/c		-	7,20,000
	(Being stock taken over by Sonu)
iv.	No Entry
v.	Realisation A/c   ...Dr.		10,000	-
	To Sonu's capital A/c		-	10,000
	(Being realisation exp. paid by a partner)