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Numerical Example of Assets Realisation

Is the loan b...

Question

Is the loan by a partner transferred to Realisation Account at the time of dissolution of a partnership firm? Why?

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Solution

No, it is not transferred to the Realisation Account because it is payable after outside liabilities are paid.

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Q. State whether the following statements are True or False.

At the time of dissolution loan from partner will be transferred to Realisation Account.

At the time of dissolution, all the assets of the firm are transferred to Realisation Account at ___________ values.

On dissolution of a firm, partner’s loan account is transferred to _________

Q. State whether the following statements are True or False.

At the time of dissolution of Partnership Firm all assets should be transferred to Realisation A/c.

Q. Bale and Yale are equal partners of a firm. They decide to dissolve their partnership on 31st March,2018 at which date their Balance Sheet stood as:


Liabilities		₹	Assets	₹
Capital A/cs:			Building	45,000
Bale	50,000		Machinery	15,000
Yale	40,000	90,000	Furniture	12,000
General Reserve		8,000	Debtors	8,000
Bale's Loan A/c		3,000	Stock	24,000
Creditors		14,000	Bank	11,000

		1,15,000		1,15,000

(a) The assets realised were:
Stock ₹ 22,000; Debtors ₹ 7,500; Machinery ₹ 16,000; Building ₹ 35,000.
(b) Yale took over the Furniture at ₹ 9,000.
(c) Bale agreed to accept ₹ 2,500 in full settlement of his Loan Account .
(d) Dissolution Expenses amounted to ₹ 2,500.
Prepare the:
(i) Realisation Account; (ii) Capital Accounts of Partners;
(iii) Bale's Loan Account; (iv) Bank Account.

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