Q.No.32 | Chapter 7 – Dissolution of a Partnership Firm | T.S. Grewal 12 Class Book Keeping Part - A - Vol. 1

Question 32 Chapter 7 of +2-A

32. Mrs Rita Chowdhary and Miss Sobha are partners in a firm, Fancy Garments Exports, sharing profits and losses equally. On 1st April 2018, the Balance Sheet of the firm was:

Liabilities	Amount	Assets		Amount
Sundry Creditor	75,000	Cash		6,000
Bills Payable	30,000	Bank		30,000
Mr. Chowdhary's Loan	15,000	Stock		75,000
Reserve Fund	24,000	Book Debts	66,000
Mrs. Rita Chowdhary's Capital	90,000	Less: Provision for Doubtful Debts	6,000	60,000
Miss Sobha's Capital	30,000	Plant and Machinery		45,000
		Land and Building		48,000
	2,64,000			2,64,000

The firm was dissolved on the date given above. The following transactions took place:
a Mrs. Rita Chowdhary undertook to pay Mr Chowdhary's Loan and took over 50% of the stock at a discount of 20%.
b Book Debts realised 54,000; the balance of the Stock was sold off at a profit of 30% on cost.
c Sundry Creditors were paid out at a discount of 10%. Bills Payable were paid in full.
d Plant and Machinery realised 75,000. Land and Building 1,20,000.
e Mrs Rita Chowdhary took over the goodwill of the firm at a valuation of 30,000.
f An unrecorded asset of 6,900 was handed over to an unrecorded liability of 6,000 in full settlement. g Realisation expenses were 5,250.
Show Realisation Account, Partners' Capital Accounts and Bank Account in the books of the firm.

 

The solution of Question 32 Chapter  7 of +2-A: -

 

Realization Account

Particular		Amount	Particular		Amount
Stock		75,000	Provision for Doubtful Debts		6,000
Book Debts		66,000	Sundry Creditors		75,000
Plant and Machinery		45,000	Bills Payable		30,000
Land and building		48,000	Mr. Chowdhary’s Loan		15,000
Bank A/c:-			Mrs. Rita Chowdhary’s Capital A/c		2,500
Sundry Creditors	67,500
Bills Payable	30,000		Stock	30,000
Expenses	5,250	1,02,750	Goodwill	30,000	60,000
			Bank
			Book Debts	54,000
			Stock	48,750
Profit transferred to:			Plant and Machinery	75,000
Mrs. Rita Chowdhary’s Capital A/c	66,000		Land and Building	1,20,000	2,97,750
Miss Sobha’s Capital A/c	66,000	74,000
		4,83,750			4,83,750

 

 

Partners’ Capital Account

Part.	Mrs. Rita Chowdhar	Miss Sobha	Part.	Mrs. Rita Chowdhar	Miss Sobha
To Realization A/c Assets	60,000	-	By Balance B/d	90,000	30,000
			By Reserve Fund A/c	12,000	12,000
			By Realization A/c	15,000	-
			By Realization profit A/c	66,000	66,000
To Cash A/c	1,23,000	1,08,000
	1,16,333	1,08,000		1,16,333	1,08,000

 

 

Bank Account

Particular		Amount	Particular		Amount
Balance b/d		30,000	Realization A/c		1,02,750
Realization A/c		2,97,750	Mrs. Rita Chowdhary’s Capital A/c		1,23,000
Cash A/c		6,000	Miss Sobha’s Capital A/c		1,08,000
		3,33,750			3,33,750

 

 

 

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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