Practical problem | Aster Classes

Practical problem | Q 5 | Page 246

Seeta, and, Geeta, are partners, in the firm, sharing Profits, and Losses, in the ratio of 4:1, They decided to dissolve the partnership on 31st March 2020 on which date their Balance Sheet stood as follows.

Additional Information :

1. Plant and Stock taken over by Seeta ₹ 78,000, and ₹ 22,000 respectively

2. Debtors Realised 90% of the Book Value and Trademark at ₹ 5,000. and Goodwill was realised for ₹ 27,000.

3. Unrecorded assets estimated ₹4,500 was sold for ₹1,500.

4. ₹ 1,000 Discount were allowed by creditors while paying their claim.

5. The Realisation Expenses amounted to ₹ 3,500

You are required to prepare Realisation A/c, Cash A/c, and Partners Capital A/c


SOLUTION

Working Notes :

(1) Bank Loan is an external liability of the firm and therefore it is transferred to Realisation A/c.

(2) Amount recovered from Debtors = 90 % of Gross Debtors = (90/100) × 48000 = ₹ 43200.

(3) Amount paid to creditors = Value of Creditors – Discount given = 35,000 – 1,000 = ₹ 34,000.

(4) Sale of unrecorded assets for ₹ 1,500 is recorded on the credit side of realisation A/c and debit side of Cash A/c.

(5) It is presumed that Furniture realised nothing.


VISITORS COUNT

159896
Users Today : 600
Total Users : 159895
Views Today : 1513
Total views : 598241

Browse Categories

Archives