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✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
Pass Journal entries for the following at the time of dissolution of a firm: (a) Sale of assets – ₹50,000. (b) Payment of liabilities – ₹10,000. (c) A commission of 5% allowed to Mr. X, a partner, on the sale of assets. (d) Realisation expenses amounted to ₹15,000; the firm had agreed to reimburse Amrit, a partner, up to ₹10,000. (e) Employees’ Provident Fund ₹10,000 (paid off). (f) Z, an old customer whose account for ₹6,000 was written off as bad in the previous year, paid 60% of the amount written off. (g) Investments (Book Value ₹10,000) realised at 150%. (h) Realisation expenses were ₹10,000; the firm had agreed to reimburse Krishan, a partner, up to ₹7,500.
JOURNAL
| Date | Particulars | L.F. | Dr. (₹) | Cr. (₹) |
|---|---|---|---|---|
| (a) | ||||
| Cash A/c Dr. | 50,000 | |||
| To Realisation A/c | 50,000 | |||
| (Assets realised for cash) | ||||
| (b) | ||||
| Realisation A/c Dr. | 10,000 | |||
| To Cash A/c | 10,000 | |||
| (Payment of liabilities) | ||||
| (c) | ||||
| Realisation A/c Dr. | 2,500 | |||
| To X’s Capital A/c | 2,500 | |||
| (5% commission allowed to X on sale of assets of ₹50,000) | ||||
| (d) | ||||
| Realisation A/c Dr. | 10,000 | |||
| Amrit’s Capital A/c Dr. | 5,000 | |||
| To Cash A/c | 15,000 | |||
| (Realisation expenses of ₹15,000 paid; only the agreed ₹10,000 charged to Realisation, the excess ₹5,000 borne by Amrit) | ||||
| (e) | ||||
| Realisation A/c Dr. | 10,000 | |||
| To Cash A/c | 10,000 | |||
| (Employees’ Provident Fund paid off) | ||||
| (f) | ||||
| Cash A/c Dr. | 3,600 | |||
| To Realisation A/c | 3,600 | |||
| (60% of bad debts previously written off against Z now recovered) | ||||
| (g) | ||||
| Cash A/c Dr. | 15,000 | |||
| To Realisation A/c | 15,000 | |||
| (Investments realised at 150% of book value) | ||||
| (h) | ||||
| Realisation A/c Dr. | 7,500 | |||
| To Krishan’s Capital A/c | 7,500 | |||
| (Krishan reimbursed up to the agreed limit for realisation expenses) | ||||
Accounting & Commerce Educator
Sarbjit Singh holds a B.Com and M.Com degree and has over 12 years of teaching experience in double entry bookkeeping, financial accounting, and business studies.
This guide covers "T.S. Grewal Class 12 Chapter 7 Q.10 - Dissolution of a Partnership Firm", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to Chapter 7 - Dissolution of a Partnership Firm.
It is primarily curated for Class 11 and Class 12 high school commerce, accounting, and economics students, as well as aspirants preparing for board exams or CA Foundation.
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