Q.No.20 | Chapter 7 – Dissolution of a Partnership Firm | T.S. Grewal 12 Class Book Keeping Part - A - Vol. 1

Question 20 Chapter 7 of +2-A

20. Bale and Yale are equal partners of a firm. They decide to dissolve their partnership on 31st March 2018 at which date their Balance Sheet stood as:

Liabilities		Amount	Assets	Amount
Capital A/cs:			Building	45,000
Bale	50,000		Machinery	15,000
Yale	40,000	90,000	Furniture	12,000
General Reserve		8,000	Debtors	8,000
Bale's Loan A/c		3,000	Stock	24,000
Creditors		14,000	Bank	11,000
		1,15,000		1,15,000

a The assets realized were: Stock 22,000; Debtors 7,500; Machinery 16,000; Building 35,000.
b Yale took over the Furniture at 9,000.
c Bale agreed to accept 2,500 in full settlement of his Loan Account .
d Dissolution Expenses amounted to 2,500. Prepare the:
i Realization Account;
ii Capital Accounts of Partners;
iii Bale's Loan Account;
iv Bank Account

 

The solution of Question 20 Chapter  7 of +2-A: -

 

Realization Account

Particular		Amount	Particular		Amount
Building		45,000	Sundry Creditors		14,000
Machinery		15,000	Bank A/c:
Furniture		12,000	Stock	22,000
Debtors		8,000	Debtors	7,500
Stock		24,000	Machinery	16,000
Bank A/c:			Building	35,000	80,500
Creditors	14,000		Bale’s Loan		500
Expenses	2,500	16,500	Yale’s Capital A/c Furniture		9,000
			Realization Loss
			Bale’s Capital A/c	8,250
			Yale’s Capital A/c	8,250	16,500
		1,20,500			1,20,500

 

Partners’ Capital Account

Part.	Bale	Yale	Part.	Bale	Yale
To Realization loss	8,250	8,250	By Balance B/d	50,000	40,000
To Realization A/c	-	9,000	By General Reserve Old Ratio	4,000	4,000
					-
To Balance c/d	45,750	26,750
	54,000	44,000		54,000	44,000

 

Bale’s Loan Account

Particular		Amount	Particular		Amount
Bank A/c		2,500	Balance b/d		3,000
Realization A/c		500
		3,000			3,000

 

Bank Account

Particular		Amount	Particular		Amount
Balance b/d		11,000	Bale’s Loan		2,500
Realization A/c		80,500	Realization A/c		16,500
			Bale’s Capital A/c		45,750
			Yale’s Capital A/c		26,750
		91,500			91,500

 

 

 

T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)

• Chapter No. 1 – Financial Statement of Not-For-Profit Organisations
• Chapter No. 2 – Accounting for Partnership Firms – Fundamentals
• Chapter No. 3 – Goodwill: Nature and Valuation
• Chapter No. 4 – Change in Profit-Sharing Ratio Among the Existing Partners
• Chapter No. 5 – Admission of a Partner
• Chapter No. 6 – Retirement/Death of a Partner
• Chapter No. 7 – Dissolution of a Partnership Firm

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

• Chapter No. 8 – Company Accounts –  Accounting for Share Capital
• Chapter No. 9 – Company Accounts – Issue of Debentures
• Chapter No. 10 – Redemption of Debentures

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

• Chapter No. 1 – Financial Statements of a Company
• Chapter No. 2 – Financial Statement Analysis 
• Chapter No. 3 – Tools of Financial Statement Analysis – Comparative Statements and Common- Size Statements
• Chapter No. 4 – Accounting Ratios
• Chapter No. 5 – Cash Flow Statement

 

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