Question

Naina, Uday, and Tara were partners in a firm sharing profits and losses in the ratio of 5 : 3: 2. The firm was dissolved on 31-3-2019. After transfer of assets (other than cash) and external liabilities to Realization Account, the following transactions took place :
(a) A typewriter completely written off from the books was sold for ₹ 4,000.
(b) Loan of ₹ 30,000 advanced by Uday to the firm was paid back.
(c) Tara was to get a remuneration of ₹ 42,000 for completing the dissolution process and forbearing realization expenses. Actual realization expenses amounted to ₹ 51,000 and were paid by the firm.
(d) Creditors of ₹ 23,000 took over all the investments at ₹ 12,000. Remaining amount was paid to them in cash.
(e) Uday agreed to pay loan of Mrs. Uday ₹ 45,000.
(f) Profit and Loss Account balance of ₹ 20,000 appeared on the asset side of the balance sheet.
Pass necessary journal entries for the above transactions in the books of the firm.

Answer 1

Journal 

Date	Particulars		L.F.	Debit Amount (₹)	Credit Amount (₹)
2019
Mar. 31	Cash A/c	Dr.		4,000
	To Realisation A/c				4,000
	(Being unrecorded sold)
Mar. 31	Uday’s Loan A/c	Dr.		30,000
	To Cash A/c				30,000
	(Being Uday’s loan paid)
Mar. 31	Realisation A/c	Dr.		42,000
	To Tara’s Capital A/c				42,000
	(Being remuneration payable for dissolution)
Mar. 31	Tara’s Capital A/c	Dr.		51,000
	To Cash A/c				51,000
	(Being realization expenses paid by firm, borne by partner)
Mar. 31	Realisation A/c	Dr.		11,000
	To Cash A/c				11,000
	(Being creditors accepted investments and balance paid in cash)
Mar. 31	Realisation A/c	Dr.		45,000
	To Uday’s Capital A/c				45,000
	(Being Uday agreed to pay Mrs. Uday loan)
Mar. 31	Naina’s Capital A/c	Dr.		10,000
	Uday’s Capital A/c	Dr.		6,000
	Tara’s Capital A/c	Dr.		4,000
	To Profit & Loss A/c				20,000

Note: No entry for investment accepted by creditors.