P- Q and R were partners in a firm sharing profits and losses in the ratio of 5- 3- 2- They agreed to dissolve their partnership firm on 31 st March- 2018- P was deputed to realise the assets and pay the liabilities- He as paid 1-000 as commission for his services- The financial position of the firm was-Balance Sheet as 31 st at 3 March- 2018took over Investments for - 12-500- Stock and Debtors realised - 11-500- Plant and Machinery were sold to Q for - 22-500 for cash- Unrecorded assets realised - 1-500 - Realisation expenses paid amounted to - 900 - Prepare necessary Ledger Accounts to close the books of the firm-

Realisation Account Dr. nbsp; Cr. Particulars Amount Rs Particulars ...

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Byju's Answer

Standard XII

Accountancy

Reassessment of Liabilities

P, Q and R we...

Question

P, Q and R were partners in a firm sharing profits and losses in the ratio of 5 : 3 : 2 . They agreed to dissolve their partnership firm on 31st March, 2018. P was deputed to realise the assets and pay the liabilities . He as paid ₹ 1,000 as commission for his services. The financial position of the firm was:

Balance Sheet
as at 31st March, 2018

Liabilities

₹

Assets

₹

Creditors
10,000
Stock
5,500

Bills Payable 3,700 Investments 15,000

Investments Fluctuation Reserve 4,500 Debtors 7,100

Less: Provision for Doubtful Debtors 450 6,650

Capital A/cs: Cash 5,600

P
37,550
R's Capital A/c

8,000

Q 15,000 52,550 Plant and Machinery 30,000

70,750

70,750

P took over Investments for ₹ 12,500. Stock and Debtors realised ₹ 11,500. Plant and Machinery were sold to Q for ₹ 22,500 for cash. Unrecorded assets realised ₹ 1,500. Realisation expenses paid amounted to ₹ 900.
Prepare necessary Ledger Accounts to close the books of the firm.

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Solution

Realisation Account

Dr.

Cr.

Particulars

Amount

Rs

Particulars

Amount

Rs

Plant and Machinery

30,000

Creditors

10,000

Stock

5,500

Bills Payable

3,700

Investments

15,000

Investments Fluctuation Reserve

4,500

Debtors

7,100

Provision for Doubtful Debts

450

Cash A/c:

P’s Capital A/c (Investments)

12,500

Creditors

10,000

Cash A/c:

Bills Payable

3,700

Stock and Debtors

11,500

Expenses

900

14,600

Plant and Machinery

22,500

P’s Capital A/c

1,000

Unrecorded Assets

1,500

35,500

Loss transferred to:

P’s Capital A/c

3,275

Q’s Capital A/c

1,965

R’s Capital A/c

1,310

6,550

73,200

73,200

Partners’ Capital Accounts

Dr.

Cr.

Particulars

P

Q

R

Particulars

P

Q

R

Balance b/d

–

–

8,000

Balance b/d

37,550

15,000

–

Realisation (Loss)

3,275

1,965

1,310

Realisation A/c

1,000

–

–

Realisation A/c (Investments)

12,500

Cash A/c

22,775

13,035

–

Cash A/c

–

–

9,310

38,500

15,000

9,310

38,550

15,000

9,310

Cash Account

Dr.

Cr.

Particulars

Amount

Rs

Particulars

Amount

Rs

Balance b/d

5,600

Realisation A/c

14,600

Realisation A/c

35,500

P’s Capital A/c

22,775

R’s Capital A/c

9,310

Q’s Capital A/c

13,035

50,410

50,410

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Similar questions

Q. P, Q and R were partners in a firm sharing profits and losses in the ratio of 5 : 3 : 2. They agreed to dissolve their partnership firm on 31st March, 2019. P was deputed to realise the assets and pay the liabilities. He was paid ₹ 1,000 as commission for his services. The financial position of the firm was:

	Balance Sheet as at 31st March, 2019
Liabilities			Amount (₹)	Assets		Amount (₹)
Creditors			10,000	Stock		5,500
Bills Payable			3,700	Investments		15,000
Investments Fluctuation Reserve			4,500	Debtors	7,100
Capital A/cs:				Less: Provision for Doubtful Debtors	450	6,650
P		37,550		Cash		5,600
Q		15,000	52,550	R's Capital A/c		8,000
				Plant and Machinery		30,000

			70,750			70,750

P took over Investments for ₹ 12,500. Stock and Debtors realised ₹ 11,500. Plant and Machinery were sold to Q for ₹ 22,500 for cash. Unrecorded assets realised ₹ 1,500. Realisation expenses paid amounted to ₹ 900.
Prepare necessary Ledger Accounts to close the books of the firm.

Q. Pradeep and Rajesh were partners in a firm sharing profits and losses in the ratio of 3 : 2. They decided to dissolve their partnership firm on 31st March, 2018. Pradeep was deputed to realise the assets and to pay off the liabilities. He was paid ₹ 1,000 as commission for his services. The financial position of the firm on 31st March, 2018 was as follows:

BALANCE SHEET as at 31st March, 2018
Liabilities		Amount (₹)	Assets		Amount (₹)
Creditors		80,000	Building		1,20,000
Mrs. Pradeep's Loan		40,000	Investment		30,600
Rajesh's Loan		24,000	Debtors	34,000
Investment Fluctuation Fund		8,000	Less: Provision for Doubtful Debts	4,000	30,000
Capital A/cs:			Bills Receivable		37,400
Pradeep	42,000		Bank		6,000
Rajesh	42,000	84,000	Profit and Loss A/c		8,000
			Goodwill		4,000
		2,36,000			2,36,000

Following terms and conditions were agreed upon:
(a) Pradeep agreed to pay off his wife's loan.
(b) Half of the debtors realised ₹ 12,000 and remaining debtors were used to pay off 25% of the creditors.
(c) Investment sold to Rajesh for ₹ 27,000.
(d) Building realised ₹ 1,52,000.
(e) Remaining creditors were to be paid after two months, they were paid immediately at 10% p.a. discount.
(f) Bill receivables were settled at a loss of ₹ 1,400.
(g) Realisation expenses amounted to ₹ 2,500.
Prepare Realisation Account.

Q. P, Q and R are partners sharing profits and losses in the ratio of 3 : 3 : 2 respectively. Their respective capitals are in their profit-sharing proportions. On 1st April, 2018, the total capital of the firm and the balance of General Reserve are ₹ 80,000 and ₹ 20,000 respectively. During the year 2018-19, the firm made a profit of ₹ 28,000 before charging interest on capital @ 5%. The drawings of the partners are P

—

₹ 8,000; Q

—

₹ 7,000; and R

—

₹ 5,000. On 31st March, 2019, their liabilities were ₹ 18,000.
On this date, they decided to dissolve the firm. The assets realised ₹ 1,08,600 and realisation expenses amounted to ₹ 1,800.
Prepare necessary Ledger Accounts to close the books of the firm.

Q. A, B and C were partners sharing profits in the ratio of 2 : 2 : 1 . They decided to dissolve their firm on 31st March, 2018 when the Balance Sheet was :

Liabilities		Amount (₹)	Assets		Amount (₹)
Creditors		40,000	Cash		40,000
Bills Payable		46,000	Debtors	70,000
Employees’ Provident Fund		32,000	Furniture	6,000	64,000
Mrs. A’s Loan		38,000	Stock		50,000
C’s Loan		30,000	Investments		60,000
Investments Fluctuation Reserve		16,000	Furniture		42,000
Capitals A/cs:			Machinery		1,36,000
A	1,20,000		Land		1,00,000
B	1,00,000		Goodwill		30,000
C	1,00,000	3,20,000

		5,22,000			5,22,000

Following transactions took place :
(a) A took over Stock at ₹ 36,000. He also took over his wife's loan.
(b) B took over half of Debtors at ₹ 28,000.
(c) C took over Investments at ₹ 54,000 and half of Creditors at their book value.
(d) Remaining Debtors realised 60% of their book value . Furniture sold for ₹ 30,000; Machinery ₹ 82,000 and Land ₹ 1,20,000.
(e) An unrecorded asset was sold for ₹ 22,000.
(f) Realisation expenses amounted to ₹ 4,000.
Prepare necessary Ledger Accounts to close the books of the firm.

Q. A, B and C were partners sharing profits in the ratio of 2 : 2 : 1. They decided to dissolve their firm on 31st March, 2019 when the Balance Sheet was:

Liabilities		Amount (₹)	Assets		Amount (₹)
Creditors		40,000	Cash		40,000
Bills Payable		46,000	Debtors	70,000
Employees’ Provident Fund		32,000	Less: Provision for Doubtful Debts	6,000	64,000
Mrs. A’s Loan		38,000	Stock		50,000
C’s Loan		30,000	Investments		60,000
Investments Fluctuation Reserve		16,000	Furniture		42,000
Capitals A/cs:			Machinery		1,36,000
A	1,20,000		Land		1,00,000
B	1,00,000		Goodwill		30,000
C	1,00,000	3,20,000

		5,22,000			5,22,000

Following transactions took place:
(a) A took over Stock at ₹ 36,000. He also took over his wife's loan.
(b) B took over half of Debtors at ₹ 28,000.
(c) C took over Investments at ₹ 54,000 and half of Creditors at their book value.
(d) Remaining Debtors realised 60% of their book value. Furniture sold for ₹ 30,000; Machinery ₹ 82,000 and Land ₹ 1,20,000.
(e) An unrecorded asset was sold for ₹ 22,000.
(f) Realisation expenses amounted to ₹ 4,000.
Prepare necessary Ledger Accounts to close the books of the firm.

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	Balance Sheet as at 31st March, 2018
Liabilities			₹	Assets		₹
Creditors			10,000	Stock		5,500
Bills Payable			3,700	Investments		15,000
Investments Fluctuation Reserve			4,500	Debtors	7,100
				Less: Provision for Doubtful Debtors	450	6,650
Capital A/cs:				Cash		5,600
P		37,550		R's Capital A/c		8,000
Q		15,000	52,550	Plant and Machinery		30,000


			70,750			70,750

Realisation Account
Dr.					Cr.
Particulars		Amount Rs	Particulars			Amount Rs
Plant and Machinery		30,000	Creditors			10,000
Stock		5,500	Bills Payable			3,700
Investments		15,000	Investments Fluctuation Reserve			4,500
Debtors		7,100	Provision for Doubtful Debts			450
Cash A/c:			P’s Capital A/c (Investments)			12,500
Creditors	10,000		Cash A/c:
Bills Payable	3,700		Stock and Debtors	11,500
Expenses	900	14,600	Plant and Machinery	22,500
P’s Capital A/c		1,000	Unrecorded Assets	1,500		35,500
			Loss transferred to:
			P’s Capital A/c	3,275
			Q’s Capital A/c	1,965
			R’s Capital A/c	1,310		6,550
		73,200				73,200

Partners’ Capital Accounts
Dr.								Cr.
Particulars	P	Q	R	Particulars	P	Q	R
Balance b/d	–	–	8,000	Balance b/d	37,550	15,000	–
Realisation (Loss)	3,275	1,965	1,310	Realisation A/c	1,000	–	–
Realisation A/c (Investments)	12,500
Cash A/c	22,775	13,035	–	Cash A/c	–	–	9,310
	38,500	15,000	9,310		38,550	15,000	9,310

Cash Account
Dr.				Cr.
Particulars	Amount Rs	Particulars	Amount Rs
Balance b/d	5,600	Realisation A/c	14,600
Realisation A/c	35,500	P’s Capital A/c	22,775
R’s Capital A/c	9,310	Q’s Capital A/c	13,035

	50,410		50,410