Question

Sita and Gita were partners sharing profits and losses in the ratio of 4 : 5. They dissolved their partnership on 31st March, 2021, when their Balance Sheet showed the following balances:

Particulars	(₹)
Sita’s Capital	30,000
Gita’s Capital	35,000
Gita’s Current A/c (Dr)	2,000
Contingency Reserve	18,000
P/L A/c (Dr)	4,500

On the date of dissolution:

1. The firm, upon realisation of assets and settlement of liabilities, made a profit of ₹ 9,000.
2. Gita paid the realisation expenses of ₹ 2,000.
3. Gita discharged the outstanding salary of the manager of the firm of ₹ 1,000 which was unrecorded in the books.

You are required to prepare the Partner’s Capital Accounts.

Answer 1

Partner’s Capital Account
Particulars	Sita	Gita	Particulars	Sita	Gita
To Current A/c	-	2,000	By Balance b/d	30,000	35,000
To P/L (Dr.)	2,000	2,500	By Contingency Reserve A/c	8,000	10,000
To Bank A/c	40,000	48,500	By Realisation A/c (Profit)	4,000	5,000
			By Realisation A/c (Expenses)	-	2,000
			By Realisation A/c (Manager salary)	-	1,000
	42,000	53,000		42,000	53,000