Question

Ashu And Harish are partners sharing profit and losses as 3: 2 They decided to dissolve the firm on december 31. 2012. Their balance sheet on the above date was
$$\begin{array}{cccccccc}& & & & \text{Balance Sheet of Ashu and Harish}& & & \\ & & & & \text{as on December 31. 2012}& & & \end{array}$$
$$\begin{array}{ccccc}\text{Liabilities}& & \text{Amt.}& \text{Assets}& \text{Amt.}\\ \text{Capitals}& & & \text{Building}& 80,000\\ \text{Ashu}& 1,08,000& & \text{Machinery}& 70,000\\ \text{Harish}& \underset{–}{54,000}& 1,62,000& \text{Furniture}& 14,000\\ \text{Creditors}& & 88,000& \text{Stock}& 20,000\\ \text{Bank Overdraft}& & 50,000& \text{Investment}& 60,000\\ & & & \text{Debtors}& 48,000\\ & & & \text{Cash in Hand}& 8,000\\ & & \underset{–}{}& & \underset{–}{}\\ & & 3,00,000& & 3,00,000\\ & & \underset{–}{}& & \underset{–}{}\end{array}$$

Ashu is to take over the building at Rs. 95,000 and Machinery and Furniture is taken over by Harish at value of Rs. 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 Rs. 46,000. Expenses of realisation amounted to Rs. 3,000.
Prepare necessary ledger account.

Answer 1

$$\begin{array}{cccccccc}\text{Dr.}& & & & \text{Realisation Account}& & & \text{Cr.}\end{array}$$
$$\begin{array}{ccccc}\text{Particulars}& & \text{Amt.}& \text{Particulars}& \text{Amt.}\\ \text{Building}& & 80,000& \text{Creditors}& 88,000\\ \text{Machinery}& & 70,000& \text{Bank Overdraft}& 50,000\\ \text{Furniture}& & 14,000& \text{Ashu's Capital A/c (Assets Taken)}& 1,43,000\\ \text{Stock}& & 20,000& \text{Harish's Capital A/c (Assets Taken)}& 1,12,000\\ \text{Investments}& & 60,000& \text{Cash (Debtors)}& 46,000\\ \text{Debtors}& & 48,000& & \\ \text{Ashu's Capital A/c (Creditors)}& & 88,000& & \\ \text{Harish's Capital A/c (Bank Overdraft)}& & 50,000& & \\ \text{Cash (Expenses)}& & 3,000& & \\ \text{Profit Transferred to}& & & & \\ \text{Ashu's Capital A/c}& 3,600& & & \\ \text{Harish's Capital A/c}& \underset{–}{2,400}& 6,000& & \\ & & \underset{–}{}& & \underset{–}{}\\ & & 4,39,000& & 4,39,000\\ & & \underset{–}{}& & \underset{–}{}\end{array}$$

$$\begin{array}{cccccccc}\text{Dr.}& & & & \text{Partners' Capital Account}& & & \text{Cr.}\end{array}$$

$$\begin{array}{cccccc}\text{Particulars}& \text{Ashu}& \text{Harish}& \text{Particulars}& \text{Ashu}& \text{Harish}\\ \text{Realisation (Assets Taken)}& 1,43,000& 1,12,000& \text{Balance b/d}& 1,08,000& 54,000\\ \text{Cash (Balancing Figure)}& 56,600& & \text{Realisation (Liabilities)}& 88,000& 50,000\\ & & & \text{Realisation (Profit)}& 3,600& 2,400\\ & & & \text{Cash (Balancing Figure)}& & 5,600\\ & \underset{–}{}& \underset{–}{}& & \underset{–}{}& \underset{–}{}\\ & 1,99,600& 1,12,000& & 1,99,600& 1,12,000\\ & \underset{–}{}& \underset{–}{}& & \underset{–}{}& \underset{–}{}\end{array}$$

$$\begin{array}{cccccccc}\text{Dr.}& & & & \text{Cash Account}& & & \text{Cr.}\end{array}$$

$$\begin{array}{cccc}\text{Particulars}& \text{Amt.}& \text{Particulars}& \text{Amt.}\\ \text{Balance b/d}& 8,000& \text{Realisation (Expenses)}& 3,000\\ \text{Realisation (Debtors)}& 46,000& \text{Ashu's Capital A/c}& 56,000\\ \text{Harish's Capital A/c}& 5,600& & \\ & \underset{–}{}& & \underset{–}{}\\ & 59,600& & 59,600\\ & \underset{–}{}& & \underset{–}{}\end{array}$$

Working Note
$$\begin{array}{ccc}\text{Assets taken by}& \text{Ashu}& \text{Harish}\\ \text{Building}& 95,000& -\\ \text{Machinery and Furniture}& -& 80,000\\ \text{Stock (in 3 : 2) Ratio}& 12,000& 8,000\\ \text{Investment (in 3 : 2) Ratio}& 36,000& 24,000\\ & \underset{–}{}& \underset{–}{}\\ & 1,43,000& 1,12,000\\ & \underset{–}{}& \underset{–}{}\end{array}$$