Question

Hemant and Pankaj were partners sharing Profit & Loss in the ratio of 3 : 2. The firm was dissolved on March 31, 2024 and the following balances were appearing in the books of the firm.

1. Hemant’s Loan: ₹ 80,000
2. Ruby’s Loan ₹ 50,000
3. Creditors ₹ 1,00,000
4. Capital Balances after all adjustments - Hemant - ₹ 1,60,000 and Pankaj - ₹ 1,40,000

Assets of the firm realised at ₹ 6,00,000. You are required to show the amounts and order of payments as per section 48 of Indian Partnership Act 1932 at the time of dissolution of the firm.

Answer 1

Total Realisation Amount = ₹ 6,00,000

Order of Payment and Amount Paid:

1. Payment of Outside Liabilities:

Creditors = ₹ 1,00,000

Ruby’s Loan = ₹ 50,000

Total paid = ₹ 1,50,000

2. Payment of Partner’s Loan:

Hemant’s Loan = ₹ 80,000

3. Payment of Partners’ Capital:

Capital balances after all adjustments:

• Hemant = ₹ 1,60,000

• Pankaj = ₹ 1,40,000

These amounts are paid fully.

4. Distribution of Surplus:

₹ 1,50,000 + ₹ 80,000 + ₹ 3,00,000

= ₹ 5,30,000

Surplus = ₹ 6,00,000 – ₹ 5,30,000

= ₹ 70,000

This surplus is distributed in profit-sharing ratio 3 : 2.

Hemant = 70,000 × `3/5`

= ₹ 42,000

Pankaj = 70,000 × `2/5`

= ₹ 28,000

Dr.	Realisation Account				Cr.
Date	Particulars	Amount (₹)	Date	Particulars	Amount (₹)
1.	To Assets Realised	6,00,000	1.	By Creditors	1,00,000
			2.	By Ruby’s Loan	50,000
			3.	By Hemant’s Loan	80,000
			4.	By Hemant’s Capital	1,60,000
			5.	By Pankaj’s Capital	1,40,000
			6.	By Profit transferred to:
				Hemant (3/5 of 70,000)	42,000
				Pankaj (2/5 of 70,000)	28,000
	Total	6,00,000		Total	6,00,000