Question

On dissolution of a partnership firm, furniture appearing in the Balance Sheet was ₹ 2,00,000. 50% of the furniture was taken over by a partner at ₹ 65,000 and balance 50% was sold at 20% less than the book value. The amount debited to bank account was:

Options

• ₹ 1,45,000

• ₹ 80,000

• ₹ 65,000

• ₹ 1,85,000

Answer 1

₹ 80,000

Explanation:

Total value of furniture = ₹ 2,00,000

50% taken over by a partner:

Value = 50% of ₹ 2,00,000 = ₹ 1,00,000

Taken over by the partner at ₹ 65,000

So. the partner takes over ₹ 65,000 worth of furniture

Remaining 50% sold at 20% less than the book value:

Remaining value = ₹ 1,00,000

20% less than book value = ₹ 1,00,000 – (20% of ₹ 1,00,000) 

= ₹ 1,00,000 – ₹ 20,000

= ₹ 80,000