Question 14 Chapter 7 of +2-A – T.S. Grewal 12 Class Part – A Vol. 1

Question 14 Chapter 7 of +2-A

Question 14 Chapter 7 of +2-A

14. Pass the Journal entries for the following transactions on the dissolution of the firm of P and Q after various assets other than cash and outside liabilities have been transferred to Realization Account:
a Stock 2,00,000. ‘P’ took over 50% of stock at a discount of 10%. Remaining stock was sold at a profit of 25% on cost.
b Debtors 2,25,000. Provision for Doubtful Debts 25,000. 20,000 of the book debts proved bad.
c Land and Building Book value 12, 50, 000 sold for 15,00,000 through a broker who charged 2% commission.
d Machinery Book value 6,00,000 was handed over to a creditor at a discount of 10%.
e Investment Bookvalue 60, 000 realised at 125%.
f Goodwill of 75,000 and prepaid fire insurance of 10,000.
g There was an old furniture in the firm which had been written off completely in the books. This was sold for 10,000.
h ‘Z’ an old customer whose account for 20,000 was written off as bad in the previous year, paid 60%.
i ‘P’ undertook to pay Mrs. P’s loan of 50,000.
j Trade creditors 1,60,000. Half of the trade creditors accepted Plant and Machinery at an agreed valuation of 54,000 and cash in full settlement of their claims after allowing a discount of 16,000.
Remaining trade creditors were paid 90% in final settlement.

 

The solution of Question 14 Chapter 7 of +2-A: –

 

Date Particulars
L.F. Debit Credit
a P’s Capital A/c Dr.   90,000  
  Bank A/c Dr.   1,25,000  
  To Realization A/c       2,15,000
  (Being Stock realized)      
b Bank A/c Dr.   2,05,000  
  To Realization A/c       2,05,000
  (Being Debtors realized)        
c Bank A/c Dr.   14,70,000  
  To Realization A/c       14,70,000
  ( Being Land and Building realized)        
d No Entry        
           
           
e Bank A/c Dr.   75,000  
  To Realization A/c       75,000
  (Being Investment realized)        
           
f No Entry        
           
g Bank A/c Dr.   10,000  
  To Realization A/c       10,000
  (Being Unrecorded furniture realized)        
h Bank A/c Dr.   12,000  
  To Realization A/c       12,000
  (Being Bad debts recovered)        
i Realization A/c Dr.   50,000  
  To P’s Capital A/c       50,000
  (Being Wife ′s loan paid by partner)        
j Realization A/c Dr.   82,000  
  To Bank A/c 10, 000 +72, 000       82,000
  (Being Creditors paid)        

 

 

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)

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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2 Book 1 min - Question 14 Chapter 7 of +2-A - T.S. Grewal 12 Class Part - A Vol. 1
Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

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