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Question 33 of 33
Q.

Q. 5. Aadesh and Sandesh were partners sharing profits and losses in the ratio 3 : 2. Their Balance Sheet on 31st March, 2016 was as under:

Balance Sheet as on 31st March, 2016

LiabilitiesAmount (₹)AssetsAmount (₹)
Capital accounts:Cash at bank5,000
Aadesh20,000Stock in trade21,000
Sandesh14,000Debtors12,000
Current accounts:Bills receivable4,000
Aadesh3,000Furniture15,000
Sandesh2,000
Creditors15,000
Bills payable3,000
57,00057,000

On the above date the firm was dissolved:

(1) Assets were realised as follows: Furniture ₹ 12,000, stock in trade ₹ 18,000, bills receivable ₹ 2,500 and debtors could be realised ₹ 9,500 only.

(2) Aadesh agreed to discharge the bills payable.

(3) Creditors were paid under 5% discount.

(4) Realisation expenses amounted to ₹ 3,000.

Pass Journal Entries in the books of the firm.

Maharashtra MsbshseMaharashtra HSC (MSBSHSE) Board 2020Subjective· 10mImportance★★★★★
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Assets of book value ₹ 52,000 realise ₹ 42,000; creditors ₹ 15,000 are paid at 5% discount (₹ 14,250), Aadesh takes over bills payable ₹ 3,000, and realisation expenses are ₹ 3,000, giving a realisation loss of ₹ 12,250 (3 : 2). Final payments: Aadesh ₹ 18,650, Sandesh ₹ 11,100; the Bank Account ties at ₹ 47,000.

Working notes:

  • Assets transferred to Realisation (book value): Stock 21,000 + Debtors 12,000 + Bills receivable 4,000 + Furniture 15,000 = ₹ 52,000.
  • Assets realised: Furniture 12,000 + Stock 18,000 + Bills receivable 2,500 + Debtors 9,500 = ₹ 42,000.
  • Creditors paid = 15,000 x 95% = ₹ 14,250 (discount ₹ 750 is a gain).
  • Bills payable ₹ 3,000 taken over by Aadesh (his capital credited).

Journal Entries in the books of the firm:

ParticularsDebit (₹)Credit (₹)
Realisation A/c ... Dr. / To Stock A/c 21,000, To Debtors A/c 12,000, To Bills Receivable A/c 4,000, To Furniture A/c 15,000 [Assets transferred]52,00052,000
Creditors A/c ... Dr. 15,000, Bills Payable A/c ... Dr. 3,000 / To Realisation A/c [Liabilities transferred]18,00018,000
Bank A/c ... Dr. / To Realisation A/c [Assets realised]42,00042,000
Realisation A/c ... Dr. / To Aadesh's Capital A/c [Bills payable taken over by Aadesh]3,0003,000
Realisation A/c ... Dr. / To Bank A/c [Creditors paid at 5% discount]14,25014,250
Realisation A/c ... Dr. / To Bank A/c [Realisation expenses paid]3,0003,000
Aadesh's Current A/c ... Dr. 3,000, Sandesh's Current A/c ... Dr. 2,000 / To Respective Capital A/cs [Current balances transferred]5,0005,000
Aadesh's Capital A/c ... Dr. 7,350, Sandesh's Capital A/c ... Dr. 4,900 / To Realisation A/c [Realisation loss 3:2]12,25012,250
Aadesh's Capital A/c ... Dr. 18,650, Sandesh's Capital A/c ... Dr. 11,100 / To Bank A/c [Final settlement to partners]29,75029,750

Supporting - Realisation Account (loss check):

| Particulars | Amount (₹) | Particulars | Amount (₹) |

| --- | --- | --- | --- | …

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