Achal and Vichal were partners in a firm sharing profits in the ratio of 3- 5 - On 31 st March- 2019 - their Balance Sheet was as follows-The firm was dissolved on 1st April- 2019 and the Assets and Liabilities were settled as follows-a Land and Building realised 4-30-000-c There was an Unrecorded Investment which was sold for - 25-000 -d Vichal took over Machinery at - 2-80-000 for cash-e 50 - of the Creditors were paid - 4-000 less in full settlement and the remaining Creditors were paid full amount- Pass necessary Journal entries for dissolution of the firm-

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Finding Cash Balance

Achal and Vic...

Question

Achal and Vichal were partners in a firm sharing profits in the ratio of 3 : 5. On 31st March, 2019, their Balance Sheet was as follows:

Liabilities Amount (₹) Assets Amount (₹)

Capital A/cs: Land and Building 4,00,000

Achal 3,00,000 Machinery 3,00,000

Vichal 5,00,000 8,00,000 Debtors 2,22,000

Creditors 1,79,000 Cash at Bank 78,000

Employees' Provident Fund 21,000

10,00,000 10,00,000

The firm was dissolved on 1st April, 2019 and the Assets and Liabilities were settled as follows:
(a) Land and Building realised ₹ 4,30,000.
(b) Debtors realised ₹ 2,25,000 (with interest) and ₹ 1,000 were recovered for Bad Debts written off last year.
(c) There was an Unrecorded Investment which was sold for ₹ 25,000.
(d) Vichal took over Machinery at ₹ 2,80,000 for cash.
(e) 50% of the Creditors were paid ₹ 4,000 less in full settlement and the remaining Creditors were paid full amount.
Pass necessary Journal entries for dissolution of the firm.

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Solution

Journal

Date

Particulars

L.F.

Debit

Amount

(₹)

Credit Amount

(₹)

2019
Apr.1

Realisation A/c

Dr.

9,22,000

To Land & Building A/c

4,00,000

To Machinery A/c

3,00,000

To Debtors A/c

2,22,000

(Being assets transferred)

Apr.1

Creditors A/c

Dr.

1,79,000

Employees’ Provident Fund A/c

Dr.

21,000

To Realisation A/c

2,00,000

(Being liabilities transferred)

Apr.1

Bank A/c

Dr.

4,30,000

To Realisation A/c

4,30,000

(Being Land & Building realised)

Apr.1

Bank A/c (2,25,000 + 1,000)

Dr.

2,26,000

To Realisation A/c

2,26,000

(Being Debtors realised along-with Bad-debts recovered)

Apr.1

Bank A/c

Dr.

25,000

To Realisation A/c

25,000

(Being Unrecorded Investments sold)

Apr.1

Bank A/c

Dr.

2,80,000

To Realisation A/c

2,80,000

(Being Machinery took over by Vichal for Cash)

Apr.1

Realisation A/c

Dr.

1,96,000

To Bank A/c (85,500 + 89,500 + 21,000)

1,96,000

(Being 50% Creditors of Rs 89,500 were paid at a discount of Rs 4,000 and remaining 50% were settled in full and EPF)

Apr.1

Realisation A/c

Dr.

43,000

To Achal’s Capital A/c

16,125

To Vichal’s Capital A/c

26,875

(Being profits on realisation transferred)

Apr.1

Achal’s Capital A/c

Dr.

3,16,125

Vichal’s Capital A/c

Dr.

5,26,875

To Bank A/c

8,43,000

(Being Partners paid off)

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Q. Ashu and Harish are partners sharing profits and losses as 3 : 2 . They decided to dissolve the firm on 31st March, 2018. Their Balance Sheet on the above date was:


Liabilities		₹	Assets	₹
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
			Debtors	48,000
			Cash in Hand	8,000

		3,00,000		3,00,000

The firm was dissolved on 1st April,2018 and the Assets and Liabilities were settled as follows :
(a) Land and Building b realised ₹ 4,30,000.
(b) Debtors realised ₹ 2,25,000 (with interest) and ₹ 1,000 were recovered for Bad Debts written off last year .
(c) There was an Unrecorded Investment which was sold for ₹ 25,000.
(d) Vichal took over Machinery at ₹ 2,80,000 for cash.
(e) 50% of the Creditors were paid ₹ 4,000 less in full settlement and the remaining Creditors were paid full amount .
Pass necessary journal entries for dissolution of the firm.

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. Debtors realised for ₹ 46,000, expenses of realisation amounted to ₹ 3,000. Prepare necessary Ledger Accounts.

Q. Achal and Vichal were partners in a firm sharing profits in the ratio of 3 : 5 . On 31st March, 2018 their Balance Sheet was as follows:


Liabilities		₹	Assets	₹
Capital A/cs:			Land and Building	4,00,000
Achal	3,00,000		Machinery	3,00,000
Vichal	5,00,000	8,00,000	Debtors	2,22,000
		1,79,000	Cash at Bank	78,000
		21,000
		10,00,000		10,00,000

Achad and Vichal were partners in a firm sharing profits in the ratio of 3 : 5. On 31.3.2011 their Balance Sheet was as follows:

$\begin{matrix} Capital and Liabilities & Amount (Rs.) & Assets & Amount (Rs.) Capital: & Land and Building & 4, 00, 000 Achal 3, 00, 000 & Machinery & 3, 00, 000 Vichal 5, 00, 000 - -------- - & 8, 00, 000 & Debtors & 2, 22, 000 Creditors & 1, 79, 000 & Cash at Bank & 78, 000 Employees Provident Fund & 21, 000 ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 10, 00, 000 - --------- - & ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 10, 00, 000 - --------- - \end{matrix}$

The firm was dissolved on 01.04.2011 and the assets and liabilities were settled as follows :

(i) Land and Building realised Rs. 4,30,000;

(ii) Debtors realised Rs. 2,25,000 (with interest) and Rs. 1,000 were recovered for bad debts written off last year;

(iii) There was an unrecorded investment which was sold for Rs. 25,000;

(iv) Vichal took-over machinery at Rs. 2,80,000 for cash;

(v) 50% of the creditors were paid Rs. 4,000 less in full settlement and the remaining creditors were paid full amount.

Prepare realisation account.

Verma and Sharma were partners sharing profits in the ratio of 3 : 1 on 31-3-2011. Their Balance Sheet was as follows:

BALANCE SHEET OF VERMA AND SHARMA

as on 31-3-2011
$\begin{matrix} Liabilities & Amount & Assets & Amount (Rs) & (Rs) Capital : & Land and Building & 70, 000 Verma 1, 20, 000 & Machinery & 60, 000 Sharma 80, 000 & 2, 00, 000 & Debotrs & 80, 000 Creditors & 70, 000 & Bank & 60, 000 ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 2, 70, 000 & ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 2, 70, 000 \end{matrix}$

The firm was dissolved on 1-4-2011 and the assets and liabilities were settled as follows :

(i) Creditors of Rs 50,000 took over land and building in full settlement of their claim.

(ii) Remaining creditors were paid in cash.

(iii) Machinery was sold at a depreciation of $30 %$

(iv) Debtors were collected at a cost of Rs 500.

(v) Expenses of realisation were Rs 1,700. Pass necessary Journal Entries for the dissolution of the firm.

Salman and Amir were partners in a firm sharing profit in the ratio of 2 : 3. On 31st March, 2011, their Balance Sheet was as follows:
BALANCE SHEET
as on 31st March, 2011
$\begin{matrix} Liabilities & Amount & Assets & Amount (Rs) & (Rs) Capitals: & Land and Building & 3, 00, 000 Salman & 2, 00, 000 & Stock & 1, 00, 000 Amir & 3, 00, 000 - -------- - & 5, 00, 000 & Debtors & 1, 50, 000 Creditors & 1, 05, 000 & Bank & 1, 55, 000 Workmen Compensation Fund & 1, 00, 000 ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 7, 05, 000 & ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 7, 05, 000 \end{matrix}$

The firm was dissolved on 1-4-2011 and the Assets and Liabilities were settled as follows:

(i) Salman agreed to take over Land and Building at Rs 3,50,000 by paying cash.

(ii) Stock was sold for Rs 90,000.

(iii) Creditors accepted debtors in full settlement of their claim.

Pass necessary Journal entries for dissolution of the firm.

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Liabilities		Amount (₹)	Assets	Amount (₹)
Capital A/cs:			Land and Building	4,00,000
Achal	3,00,000		Machinery	3,00,000
Vichal	5,00,000	8,00,000	Debtors	2,22,000
Creditors		1,79,000	Cash at Bank	78,000
Employees' Provident Fund		21,000
		10,00,000		10,00,000

Journal
Date	Particulars		L.F.	Debit Amount (₹)	Credit Amount (₹)
2019 Apr.1	Realisation A/c	Dr.		9,22,000
	To Land & Building A/c				4,00,000
	To Machinery A/c				3,00,000
	To Debtors A/c				2,22,000
	(Being assets transferred)

Apr.1	Creditors A/c	Dr.		1,79,000
	Employees’ Provident Fund A/c	Dr.		21,000
	To Realisation A/c				2,00,000
	(Being liabilities transferred)

Apr.1	Bank A/c	Dr.		4,30,000
	To Realisation A/c				4,30,000
	(Being Land & Building realised)

Apr.1	Bank A/c (2,25,000 + 1,000)	Dr.		2,26,000
	To Realisation A/c				2,26,000
	(Being Debtors realised along-with Bad-debts recovered)

Apr.1	Bank A/c	Dr.		25,000
	To Realisation A/c				25,000
	(Being Unrecorded Investments sold)

Apr.1	Bank A/c	Dr.		2,80,000
	To Realisation A/c				2,80,000
	(Being Machinery took over by Vichal for Cash)

Apr.1	Realisation A/c	Dr.		1,96,000
	To Bank A/c (85,500 + 89,500 + 21,000)				1,96,000
	(Being 50% Creditors of Rs 89,500 were paid at a discount of Rs 4,000 and remaining 50% were settled in full and EPF)

Apr.1	Realisation A/c	Dr.		43,000
	To Achal’s Capital A/c				16,125
	To Vichal’s Capital A/c				26,875
	(Being profits on realisation transferred)

Apr.1	Achal’s Capital A/c	Dr.		3,16,125
	Vichal’s Capital A/c	Dr.		5,26,875
	To Bank A/c				8,43,000
	(Being Partners paid off)