Pass necessary Journal entries for the following transaction on the dissolution of the firm of P and Q after the various assets (other than cash) and outside liabilities have been transferred to realisation Account
(a) Bank loan worth Rs. 12,000 was paid.
(b) Stock worth Rs. 16,000 was taken over by partner Q.
(c) Partner P paid a creditor Rs. 4,000.
(d) An asset not appearing in the books of accounts realised Rs. 1,200.
(e) Expenses of realisation Rs. 2,000 were paid by partner Q.
(f) Profit on realisation Rs. 36,000 was distributed between P and Q in Rs. 5:4 ratio.

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Solution

(a) Realisation A/c Dr. 12000
To Bank loan A/c 12000
(Being bank liability paid)

(b) Q's Capital A/c Dr. 16000
To Realisation A/c 16000
(Being stock taken over by Q)

(c) Realisation A/c Dr. 4000
To P's Capital A/c 4000
(Being creditor paid off by P)

(d) Bank A/c Dr. 1200
To Realisation A/c 1200
(Being realisation of unrecorded asset)

(e) Realisation A/c Dr. 2000
To Q's Capital A/c 2000
(Being expenses paid by Q)

(f) Realisation A/c Dr. 36000
To P's Capital A/c 20000
To Q's Capital A/c 16000
(Being profit on realisation distributed among the partners in the ratio of 5:4)

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Similar questions

Pass the necessary Journal entries for the following transactions on the dissolution of the firm of P and Q after the various assets (other than cash) and outside liabilities have been transferred to Realisation Account.

(i) Bank loan Rs 12,000 was paid.

(ii) Stock worth Rs 16,000 was taken over by partners.

(iii) Partner P paid a creditor Rs 4,000.

(iv) An asset not appearing in the books of accounts realised Rs 1,200.

(v) Expenses of realisation Rs 2,000 were paid by partner Q.

(iv) Profit on realisation Rs 36,000 was distributed between P and Q in 5 : 4 ratio.

Q. Pass necessary Journal entries for the following transactions on the dissolution of the firm P and Q after the various assets (other than cash) and outside liabilities have been transferred to Realisation Account:
(a) Bank Loan ₹ 12,000 was paid.
(b) Stock worth ₹ 16,000 was taken over by partner Q.
(c) Partner P paid a creditor ₹ 4,000.
(d) An asset not appearing in the books of accounts realised ₹ 1,200.
(e) Expenses of realisation ₹ 2,000 were paid by partner Q.
(f) Profit on realisation ₹ 36,000 was distributed between P and Q in 5 : 4 ratio.

Pass the necessary journal entries for the following transactions on the dissolution of the firm of Sudha and Shiva after the various assets (other than cash) and outside liabilities have been transferred to Realisation Account :

(i) Sudha agreed to pay off her husband's loan Rs. 19,000.

(ii) A debtor whose debt of Rs. 9,000 was written off in the books paid Rs. 7,500 in full settlement.

(iii) Shiva took over all investments at Rs. 13,300.

(iv) Sundry creditors Rs. 10,000 were paid at 9% discount

(v) Realisation expenses Rs. 3,400 were paid by Sudha for which she was allowed Rs 3,000.

(vi) Loss on realisation Rs. 9,400 was divided between Sudha and Shiva in 3 : 2 ratio.

Give the necessary journal entries in each of the following alternative cases :

(i) Realisation expenses amounted to Rs. 500.

(ii) Realisation expenses paid by the firm amounted to Rs. 500 and the partner has to bear the realisation expenses.

(iii) 'A' one of the partners was to bear all the realisation expenses for which he was given a commission of 2% of net cash realised from dissolution. Cash realised from assets was Rs 25,000 and cash paid for liabilities amounted to Rs 5,000

What journal entries would be recorded for the following transactions on the dissolution of a firm after various assets (Other than cash) on the third party liabilities have been transferred to realisation account ?

1. Arti took over the Stock worth Rs. 80,000 at Rs. 68,000.

2. There was unrecorded Bike of Rs. 40,000, which was taken over by Mr. Karim.

3. The firm paid Rs. 40,000 as compensation to employees.

4. Sundry creditors amounting to Rs. 36,000 were settled at a discount of 15 $%$ .

5. Loss on realisation Rs. 42,000 was to be distributed between Arti and Karim in the ratio of 3 : 4.

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