12th | Ts grewal 2021-2022 Question 29 to 32 | Dissolution of a Partnership

Page No 8.56:

Question 29:

Ashu and Harish are partners sharing profit and losses as 3 : 2 . They decided to dissolve the firm on 31st March, 2019. Their Balance Sheet on the above date was:


 

 

 

Liabilities

Amount
(
`)

Assets

Amount
รข€‹(
`)

Capital A/cs:                       

 

Building

80,000

Ashu

1,08,000 

 

Machinery

 

70,000

Harish

54,000

1,62,000

Furniture

 

14,000

Creditors

88,000

Stock

 

20,000

Bank Overdraft

50,000

Investments

 

60,000

 

 

Debtor

 

48,000

 

 

Cash in Hand

 

8,000

 

 

 

 

 

 

3,00,000

 

3,00,000

 

 

 

 

Ashu is to take over the building at  ` 95,000 and Machinery and Furniture is taken over by Harish at value of  ` 80,000. Ashu agreed to pay Creditor and Harish agreed to meet Bank overdraft. Stock and Investments are taken by both partner in profit-sharing ratio. Debtor realised for  ` 46,000, expenses of realisation amounted to  ` 3,000. Prepare necessary Ledger Accounts.

Answer:

Realisation Account

 

Dr.

 

Cr.

 

Particulars

Amount

( `)

Particulars

Amount

( `)

Building

80,000

Creditors

88,000

Machinery

70,000

Bank overdraft

50,000

Furniture

14,000

Ashu’s Capital A/c (see working note)

1,43,000

Stock

20,000

Harish’s Capital A/c (see working note)

1,12,000

Investments

60,000

Cash (Debtor)

46,000

Debtor

48,000

 

 

Ashu’s Capital A/c (Creditors )

88,000

 

 

Harish’s Capital A/c (Bank Overdraft)

50,000

 

 

Cash (Expenses)

3,000

 

 

Realisation Profit

 

 

 

Ashu’s Capital A/c

3,600

 

 

 

Harish’s Capital A/c

2,400

6,000

 

 

 

4,39,000

 

4,39,000

 

 

 

 

 

Partners Capital Account

 

Dr.

 

Cr.

 

Particulars

Ashu

Harish

Particulars

Ashu

Harish

Realisation (Assets taken)

1,43,000

1,12,000

Balance b/d

1,08,000

54,000

Cash

56,600

 

Realisation (Liabilities)

88,000

50,000

 

 

 

Realisation (Profit)

3,600

2,400

 

 

 

Cash

 

5,600

 

1,99,600

1,12,000

 

1,99,600

1,12,000

 

 

 

 

 

 

 

Cash Account

Dr.

 

 

Cr.

Particulars

 ( `)

Particulars

( `)

Balance b/d

8,000

Realisation (Expenses)

3,000

Realisation (Debtor)

46,000

Ashu’s Capital A/c

56,600

Harish’s Capital A/c

5,600

 

 

 

59,600

 

59,600

 

 

 

 


Working Notes :
 

 

Ashu

Harish

Building

95,000

 

Machinery and Furniture

 

80,000

Stock (3:2)

12,000

8,000

Investment (3:2)

36,000

24,000

 

1,43,000

1,12,000

 

 

 

 


Page No 8.56:

Question 30:


A, B and C were equal partners. On 31st March, 2019, their Balance Sheet stood as:

 

 

Liabilities

Amount
(
`)

Assets

Amount
(
`)

Creditors

50,400

Cash

3,700

Reserve

12,000

Stock

20,100

Capital A/cs:

 

Debtor

62,600

   A 

40,000

 

Loan to A

10,000

   B

25,000

 

Investments

16,000

   C

15,000

80,000

Furniture

6,500

 

 

 

Building

23,500

 

1,42,400

 

1,42,400

 

 

 

 

 

   
The firm was dissolved on the above date on the following terms:
(a) For the purpose of dissolution, Investments were valued at 
` 18,000 and A took over the Investments at this value.
(b) Fixed Assets realised 
` 29,700 whereas Stock and Debtor realised  ` 80,000.
(c) Expenses of realisation amounted to 
` 1,300.
(d) Creditors  allowed a discount of 
` 800.
(e) One Bill receivable for 
` 1,500 under discount was dishonoured as the acceptor had become insolvent and was unable to pay anything and hence the bill had to be met by the firm.
Prepare Realisation Account, Partner's Capital Accounts and Cash Account showing how the accounts would finally be settled among the partners.

Answer:

Realisation Account

Dr.

 

Cr.

Particulars

Amount

( `)

Particulars

Amount

( `)

Stock

20,100

Creditors

50,400

Debtor

62,600

 

 

Investments                              

16,000

A’s Capital A/c (Investments)

18,000

Furniture

6,500

Cash A/c:

 

Building

23,500

Furniture and Building

29,700

 

Cash A/c:

 

Stock and Debtor

80,000

1,09,700

Expenses

1,300

 

 

 

Creditors

49,600

 

 

 

Bills

1,500

52,400

Loss transferred to :

 

 

 

A’s Capital A/c

1,000

 

 

 

B’s Capital A/c

1,000

 

 

 

C’s Capital A/c

1,000

3,000

 

 

 

 

 

1,81,100

 

1,81,100

 

 

 

 

 

Partners Capital Accounts

Dr.

 

Cr.

Particulars

A

B

C

Particulars

A

B

C

Realisation A/c (Investment)

18,000

Balance b/d      

40,000

25,000

15,000

Realisation A/c
(Loss)

1,000

1,000

1,000

Reserve

4,000

4,000

4,000

Cash A/c

25,000

28,000

18,000

 

 

 

 

 

44,000

29,000

19,000

 

44,000

29,000

19,000

 

 

 

 

 

 

 

 

 

A’s Loan A/c

Dr.

Cr.

Particulars

Amount

( `)

Particulars

Amount

( `)

Balance b/d

10,000

Bank A/c

10,000

 

 

 

 

 

10,000

 

10,000

 

 

 

 

 Cash  Account  

Dr.

 

Cr.

particulars

Amount

( `)

Particulars

Amount

( `)

Balance b/d

3,700

Realisation A/c

52,400

Realisation A/c

1,09,700

A’s Capital A/c

25,000

A's Loan A/c

10,000

B’s Capital A/c

28,000

 

 

C’s Capital A/c

18,000

 

1,23,400

 

1,23,400

 

 

 

 


 

Page No 8.57:

Question 31:


Yogesh and Naresh were partners sharing profits equally. They dissolved the firm on 1st April, 2019. Naresh was assigned the responsibility to realise the assets and pay the liabilities at a remuneration of  `10,000 including expenses. Balance Sheet of the firm as on that date was as follows:

Liabilities

Amount

( `)

Assets

Amount

( `)

Creditors

40,000

Cash/Bank

6,000

Bills Payable

40,000

Investments

30,000

Naresh's Loan

44,000

Debtor

40,000

 

M `. Yogesh's Loan

42,000

Less: Provision for Doubtful Debts

4,000

36,000

Investment Fluctuation Reserve

 

8,000

Bills Receivable

33,400

Capital A/cs:

 

 

Profit and Loss A/c

1,10,600

Yogesh

21,000

 

 

 

Naresh

21,000

42,000

 

 

 

 

 

 

 

 

2,16,000

 

2,16,000

 

 

 

 

 

The firm was dissolved on following terms:
(a) Yogesh was to pay his wife's loan.
(b) Debtor realised 
`30,000.
(c) Naresh was to take investments at an agreed value of 
` 26,000.
(d) Creditors  and Bills Payable were payable after two months but were paid immediately at a discount of 15% p.a.
(e) Bills Receivable were received allowing 5% rebate.
(f) A Debtor previously written off as Bad Debt paid 
`15,000.
(g) An unrecorded asset realised 
`10,000.
Prepare Realisation Account, Partners' Capital Accounts, Partners' Loan Account and Cash/Bank Account.

Answer:

Dr.

Realisation A/c

Cr.

Particulars

Amount

( `)

Particulars

Amount

( `)

To Investments

30,000

By Investment Fluctuation Reserve

8,000

To Debtor

40,000

By Provision for Doubtful Debts

4,000

To Bills Receivable

33,400

By Creditors

40,000

 

 

By Bills Payable

40,000

To Yogesh’s Capital A/c (Wife’s Loan)

42,000

By M `. Yogesh’s Loan

42,000

To Cash/Bank A/c:

 

 

 

Creditors  [40,000 – (40,000 × 15/100 × 2/12)]

39,000

 

By Cash/Bank A/c:

 

Bills Payable [40,000 – (40,000 × 15/100 × 2/12)]

39,000

78,000

  Debtor

30,000

 

 

 

  Bills Receivable

31,730

 

To Naresh’ Capital A/c (Commission)

10,000

  Bad Debt Recovered

15,000

 

To Realisation Gain transferred to:

 

  Unrecorded Asset

10,000

86,730

    Yogesh’s Capital A/c

6,665

 

 

 

    Naresh’s Capital A/c

6,665

13,330

By Naresh’s Capital A/c (Investment taken over)

26,000

 

 

 

 

 

2,46,730

 

2,46,730

 

 

 

 

       

Dr.

Partner’s Capital A/c

Cr.

Particulars

Yogesh

( `)

Naresh

( `)

Particulars

Yogesh

( `)

Naresh

( `)

To Realisation A/ c (Asset taken over)

 

26,000

By balance b/d

21,000

21,000

 

 

 

By Realisation A/c (Gain)

6,665

6,665

To Profit & Loss A/c

55,300

55,300

By Realisation A/c (Liability paid)

42,000

 

To Cash/Bank A/c

14,365

 

 

 

 

 

 

By Realisation A/c (Commission)

 

10,000

 

 

 

By Naresh’s Loan A/c

 

43,635

 

 

 

 

 

 

 

69,665

81,300

 

69,665

81,300

 

 

 

 

 

 

 

Dr.

Naresh’s Loan A/c

Cr.

Particulars

Amount

( `)

Particulars

Amount

( `)

To Naresh’s Capital A/c

43,635

By balance b/d

44,000

To Cash/Bank A/c

365

 

 

 

 

 

 

 

44,000

 

44,000

 

 

 

 

 

Dr.

Cash/ Bank A/c

Cr.

Particulars

Amount

( `)

Particulars

Amount

( `)

To balance b/d

6,000

By Yogesh’s Capital A/c

14,365

To Realisation A/c (Asset Realised)

86,730

By Naresh’s Loan A/c

365

 

 

By Realisation A/c (Liabilities Paid)

78,000

 

 

 

 

 

92,730

 

92,730

 

 

 

 


 

Page No 8.57:

Question 32:


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