Question

Mrs. Rita chowdhary and Miss Sobha are partners in a firm , Fancy Garments Exports , sharing profits and losses equally . On 1st April, 2018, the Balance Sheet of the firm was:

Liabilities				₹	Assets			₹
Sundry Creditors				75,000	Cash			6,000
Bills Payable				30,000	Bank			30,000
Mr. Chowdhary's Loan				15,000	Stock			75,000
Reserve Fund				24,000	Book Debts		66,000
Mrs. Rita Chowdhary's Capital				90,000	Less: Provision for Doubtful Debts		6,000	60,000
Miss Sobha's Capital				30,000	Plant and Machinery			45,000
					Land and Building			48,000
				2,64,000				2,64,000

The firm was dissolved on the date given above. The following transactions took place:
(a) Mrs. Rita Chowdhary undertook to pay Mr.Chowdhary's Loan and took over 50% of the Stock at a discount of 20%.
(b) Book Debts realised ₹ 54,000; balance of the Stock was sold off at a profit of 30% on cost.
(c) Sundry Creditors were paid out at a discount of 10%. Bills Payable were paid in full .
(d) Plant and Machinery realised ₹ 75,000. Land and Building ₹ 1,20,000.
(e) Mrs. Rita Chowdhary took over the goodwill of the firm at a valuation of ₹ 30,000.
(f) An unrecorded asset of ₹ 6,900 was handed over to an unrecorded liability of ₹ 6,000 in full settlement.
(g) Realisation expenses were ₹ 5,250.
Show Realisation Account, Partners' Capital Accounts and Bank Account in the books of the firm.

Answer 1

Realisation Account
Dr.								Cr.
Particulars			Amount Rs	Particulars			Amount Rs
Stock			75,000	Provision for Doubtful Debts			6,000
Book Debts			66,000	Sundry Creditors			75,000
Plant and Machinery			45,000	Bills Payable			30,000
Land and building			48,000	Mr. Chowdhary’s Loan			15,000
Mrs. Rita Chowdhary’s Capital A/c (Mr. Chowdhary’s Loan A/c)			15,000	Mrs. Rita Chowdhary’s Capital A/c:
Bank A/c:				Stock		30,000
Sundry Creditors		67,500		Goodwill		30,000	60,000
Bills Payable		30,000		Bank A/c:
Expenses		5,250	1,02,750	Book Debts	54,000
Profit transferred to:				Stock	48,750
Mrs. Rita Chowdhary’s Capital A/c		66,000		Plant and Machinery	75,000
Miss Sobha’s Capital A/c		66,000	1,32,000	Land and Building	1,20,000		2,97,750
			4,83,750				4,83,750

Partners’ Capital Accounts
Dr.							Cr.
Particulars		Mrs. Rita Chowdhary	Miss Sobha	Particulars	Mrs. Rita Chowdhary	Miss Sobha
Realisation A/c (Assets)		60,000	–	Balance b/d	90,000	30,000
				Reserve Fund	12,000	12,000
				Realisation A/c (Mr. Chowdhary Loan)	15,000	–
Bank A/c		1,23,000	1,08,000	Realisation A/c (Profit)	66,000	66,000
		1,83,000	1,08,000		1,83,000	1,08,000

Bank Account
Dr.					Cr.
Particulars		Amount Rs	Particulars	Amount Rs
Balance b/d		30,000	Realisation A/c	1,02,750
Cash A/c		6,000	Mrs. Rita Chowdhary’s Capital A/c	1,23,000
Realisation A/c		2,97,750	Miss Sobha’s Capital A/c	1,08,000
		3,33,750		3,33,750

Working Notes

WN 1 Value of Stock taken by Mrs. Rita Chowdhary


WN 2 Value of Stock sold