Question

Shilpa, Meena and Nanda decided to dissolve their partnership on March 31, 2006. Their profit sharing ratio was 3: 2: 1 and their balance sheet was as under:
Balance Sheet of Shilpa, Meena and Nanda
as on March 31, 2006
$$\begin{array}{cccc}\text{Capital and Liabilities}& \text{Amt.}& \text{Assets}& \text{Amt.}\\ \text{Capitals:}& & \text{Land}& 81,000\\ \text{Shilpa}& 80,000& \text{Stock}& 56,760\\ \text{Meena}& 40,000& \text{Debtors}& 18,600\\ \text{Bank loan}& 20,000& \text{Nanda's Capital}& 23,000\\ \text{Creditors}& 37,000& \text{Cash}& 10,840\\ \text{Provision for doubtful debts}& 1,200& & \\ \text{General Reserve}& 12,000& & \\ & \underset{–}{}& & \underset{–}{}\\ & 1,90,200& & 1,90,200\\ & \underset{–}{}& & \underset{–}{}\end{array}$$

The stock of value of Rs. 41,660 are taken over by Shilpa for Rs. 35,000 and she agreed to discharge bank loan. The remaining stock was sold at Rs. 14,000 and debtors amounting to Rs. 10,000 realised Rs. 8,000. Land is sold for Rs. 1,10,000. The remaining debtors realised 50% at their book value. Cost of realisation amounted to Rs. 1,200.There was typewriter not recorded in the books worth Rs. 6,000, which were taken over by one of the creditors at this value.
Prepare realisation account.

Answer 1

Dr. Realisation Account Cr.
$$\begin{array}{cccccc}\text{Particulars}& & \text{Amt.}& \text{Particulars}& & \text{Amt.}\\ \text{Land}& & 81,000& \text{Bank Loan}& & 20,000\\ \text{Stock}& & 56,760& \text{Creditors}& & 37,000\\ \text{Debtors}& & 18,600& \text{Provision for Doubtful Debts}& & 1,200\\ \text{Shilpa's Capital A/c}& & 20,000& \text{Shilpa's Capital}& & 35,000\\ \text{(Bank Loan)}& & & \text{(Stock)}& & \\ \text{Cash}& & & \text{Cash}& & \\ \text{Creditors}& 31,000& & \text{Stock}& 14,000& \\ \text{Realisation Expenses}& \underset{–}{1,200}& 32,200& \text{Debtors (8,000 + 4,300)}& 12,300& \\ & & & \text{Land}& \underset{–}{1,10,000}& 1,36,300\\ \text{Profit Transferred to}& & & & & \\ \text{Shilpa's Capital A/c}& 10,470& & & & \\ \text{Meena's Capital A/c}& 6,980& & & & \\ \text{Nanda's Capital A/c}& \underset{–}{3,490}& 20,940& & & \\ & & \underset{–}{}& & & \underset{–}{}\\ & & \underset{–}{2,29,500}& & & \underset{–}{2,29,500}\end{array}$$