Question

Pass journal entries for the following:

1. Firm agreed to pay Alok ₹ 7,500 towards dissolution expenses. Dissolution expenses were ₹ 10,000, which were paid by the firm.
2. Realisation expenses were ₹ 5,000. It was agreed that the firm will bear ₹ 2,000 and the balance by Ravi, a partner.
3. Dissolution expenses of ₹ 10,000 were paid by Amit, a partner, on behalf of the firm.
4. Realisation expenses up to ₹ 6,000 was agreed by the firm to reimburse Ajay. Dissolution expenses were ₹ 7,000.

[Hint: (d) Realisation Account will be debited by 6,000.]

Answer 1

Journal Entry
Date	Particulars	L.F.	Debit (₹)	Credit (₹)
(a)
(i)	Realisation A/c   ...Dr.		7,500	-
	To Alok’s Capital A/c		-	7,500
	(Being remuneration/expenses agreed to be paid to partner Alok)
(ii)	Alok’s Capital A/c   ...Dr.		10,000	-
	To Bank/Cash A/c		-	10,000
	(Being actual dissolution expenses paid by the firm on behalf of Alok)
(b)	Realisation A/c   ...Dr.		2,000	-
	Ravi’s Capital A/c   ...Dr.		3,000	-
	To Bank/Cash A/c		-	5,000
	(Being realisation expenses paid by the firm, split according to the agreement)
(c)	Realisation A/c   ...Dr.		10,000	-
	To Amit’s Capital A/c		-	10,000
	(Being dissolution expenses paid by partner Amit on behalf of the firm)
(d)	Realisation A/c   ...Dr.		6,000	-
	To Ajay’s Capital A/c		-	6,000
	(Being expenses up to the agreed limit of ₹ 6,000 reimbursed/credited to partner Ajay)