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Susan, Geeta and Rashi Are Partners Sharing Profits and Losses in the Ratio of 5:3:2. Their Balance Sheet as at 31st March, 2017, is as Under: - Accounts

Susan, Geeta and Rashi are partners sharing profits and losses in the ratio of 5:3:2. Their Balance Sheet as at 31st March, 2017, is as under:

Balance Sheet of Susan, Geeta and Rashi As at 31st March, 2017

Liabilities Amount Assets Amount
Sundry Creditors          50,000  Cash at Bank 70,000
Workmen Compensation Reserve          25,000 

Sundry Debtor 65,000

Less Provision for Doubtful Debts (5,000

 

 

                     60,000 

Employees Provident Fund           5,000  Goodwill                      50,000 
Bank Loan         55,000  Furniture                   1,00,000 

Capital A/C

Susan                            2,20,000 

Geeta                            1,70,000 

Rashi                             1,35,000 

 

 

 

5,25,000 

Building                   3,80,000 
  6,60,000    6,60,000 

The partners decided to dissolve their partnership on 31st March, 2017. The following transactions took place at the time of dissolution :

(a) Realization expenses of 2,000 were paid by Susan on behalf of the firm.

(b) Geeta took over the goodwill for her own business at  40,000.

(c) Building was taken over by Rashi at 3,00,000.

(d) Only 80% of the debtors paid their dues.

(e) Furniture was sold for  97,000.

(f) Bank Loan was settled along with interest of 5,000. You are required to prepare the Realization Account.

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Solution

                                                        Realisation Account 

Particulars  Amount  Particulars  Amount 

To Sundry Assets

S. Debtors 65,000 

Goodwill  50,000 

Furniture  1,00,000 

Building 3,80,000 

 

 

 

 

                   5,95.000 

By Provision for bad debts  
To Susan’s Cap. (Real exp)                       2,000

By Sundry Liabilities

Creditors       50,000 

Bank Loan      55,000 

EPF                5,000 

                  1,10,000        

To Bank

Creditors        50,000 

Bank Loan       60,000     

BPF                  5,000 

 

 

 

 

                  1,15,000 

By Geeta’s Capital (GW)                     40,000
    By Rashi’s Capital (Bldg)                 3,00,000
   

By Bank

Debtors          52,000 

Furniture        97,000 

      

 

                  1,49,000 

    By Susan’s Capital A/c                     54,000 
    By Geeta’s Capital                     32,400 
    By Rashi’s Capital                     21,600 
  7,12,000    7,12,000 
Concept: Preparation of Revaluation Account and Balance Sheet
  Is there an error in this question or solution?
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