Question

Pass necessary Journal entries to record the following unrecorded assets and liabilities in the books of Paras and Priya:

1. There was an old furniture in the firm which had been written off completely in the books. This was sold for ₹ 3,000.
2. Ashish, an old customer whose account for ₹ 1,000 was written off as bad in the previous year, paid 60%, of the amount.
3. Paras agreed to takeover the firm's goodwill (not recorded in the books of the firm), at a valuation of ₹ 30,000.
4. There was an old typewriter which had been written off completely from the books. It was estimated to realise ₹ 400. It was taken by Priya at an estimated price less 25%.
5. There were 100 shares of ₹ 10 each in Star Limited acquired at a cost of ₹ 2,000 which had been written-off completely from the books. These shares are valued @ ₹ 6 each and divided among the partners in their profit-sharing ratio.

Hints:

1. Dr. Cash/Bank A/c and Cr. Realisation A/c by ₹ 3,000.
2. Dr. Cash/Bank A/c and Cr. Realisation A/c by ₹ 600.
3. Dr. Paras’s Capital A/c and Cr. Realisation A/c by ₹ 30,000.
4. Dr. Priya’s Capital A/c and Cr. Realisation A/c by ₹ 300.
5. Dr. Paras’s Capital A/c and Priya’s Capital A/c by ₹ 300 each; Cr. Realisation A/c by ₹ 600.

Answer 1

                      Journal

	Particulars		L.F.	Amount (₹)	Amount (₹)
(a)	Cash/Bank A/c	Dr.		3,000
	To Realisation A/c				3,000
	(Old and unrecorded furniture sold)
(b)	Cash/Bank A/c	Dr.		600
	To Realisation A/c				600
	(Bad debts previously written off now recovered)
(c)	Paras’s Capital A/c	Dr.		30,000
	To Realisation A/c				30,000
	(Unrecorded goodwill taken over by Paras)
(d)	Priya’s Capital A/c	Dr.		300
	To Realisation A/c				300
	(Unrecorded Typewriter taken over by Priya at25% less price)
(e)	Paras’s Capital A/c	Dr.		300
	Priya’s Capital A/c	Dr.		300
	To Realisation A/c				600
	(100 unrecorded shares of Rs 10 each in the books taken @ Rs 6 each by Paras and Priya and divided between them inprofit sharing ratio)