Question

Pass necessary journal entries for the following transactions on dissolution of the firm of Rajesh, Somesh and Yogesh after various assets (other than cash) and third party liabilities have been transferred to Realisation Account:

1. Rajesh took over stock of ₹ 4,00,000 at a discount of 20%.
2. Somesh agreed to take over the firm’s furniture, not recorded in the books of the firm at ₹ 80,000.
3. Land and Building of the book value of ₹ 60,00,000 was sold for ₹ 90,00,000 through a broker who charged 10% commission.
4. Ashish, an old customer, whose account for ₹ 70,000 was written off as bad in the previous year, paid 60% of the amount.
5. Sundry Creditors of ₹ 3,00,000 were settled at a discount of 10%.
6. Realisation expenses amounting to ₹ 21,000 were paid by Yogesh.

Answer 1

Journal
Date	Particulars	L.F.	Amount (₹)	Amount (₹)
(i)	Rajesh’s Capital A/c    ...Dr.		3,20,000	-
	To Realisation A/c		-	3,20,000
	(Being stock taken over by Rajesh, recorded)
(ii)	Somesh’s Capital A/c      ...Dr.		80,000	-
	To Realisation A/c		-	80,000
	(Being unrecorded furniture taken over by Somesh, recorded)
(iii)	Bank A/c      ...Dr.		81,00,000	-
	To Realisation A/c		-	81,00,000
	(Being building realised at Net amount ₹ 81,00,000 recorded)
(iv)	Bank A/c `(70,000xx60/100)`  ...Dr.		42,000	-
	To Realisation A/c		-	42,000
	(Being Bad debt recovered)
(v)	Realisation A/c      ...Dr.		2,70,000	-
	To Bank A/c		-	2,70,000
	(Being Sundry creditors paid at 10% discount)
(vi)	Realisation A/c      ...Dr.		21,000	-
	To Yogesh’s Capital A/c		-	21,000
	(Being realisation expenses credited to Yogesh’s Capital, Paid by him)