Question 23 Chapter 7 of +2 Part-1 – USHA Publication 12 Class Part – 1

Question 23 Chapter 7 of +2-Part-1

23. (Realisation A/c/Partner’s Capital A/e) Cloud, Storm and Rain were partners in a firm sharing profits and losses in the ratio of 5: 3:2. Due to difference of opinion, they decided dissolve the partnership with effect from 1st April, 2019, on which date the firm’s balance sheet was as under :

Liabilities	Rs.	Assets	Rs.
Capitals  A/c		Plant & Machinery	80,000
Cloud	60,000	Furniture  & fixtures	45,000
Storm	40,000	Motor Car	25,000
Rain	30,000	Stock in trade	30,000
Current A/c		Sundry debtors	71,000
Cloud	8,000	Cash at bank	14,000
Storm	10,000	Rain’s current A/c	3,000
Sundry Creditors	1,20,000
	2,68,000		2,68,000

The folllowing information is given :

1. Plant costing Rs. 40,000 was taken over by Cloud at an agreed valuation of Rs.45,000 and the remaining
2. machinery realised Rs. 50,000.
3. Furniture and fixtures realised Rs. 40,000.
4. Motor car was taken over by Storm for Rs. 30,000
5. Sundry debtors included a bad debt of Rs. 1,200 and the rest were realised, subject to cash discount of 10%.
6. Stock worth Rs. 75,000 was taken over by Rain and the rest realised at 20% above the book value.
7. The creditor for Rs. 2,000 was untraceable and rest of creditors accepted payment allowing 15% discount .
   Realisation expenses amounted to Rs.5,000.
   You are required to show the realisation account and capital accounts of partners on dissolution, showing final payment to them.

The solution of Question 23 Chapter 7 of +2 Part-1: –

Realisation A/c
Particulars		Amount	Particulars		Amount
To Sundry Debtors A/c		71,000	By Sundry Debtors A/c		1,20,000
To Stock–in-trade A/c		30,000	By Cloud’s Capital A/c
To furniture & fixtures A/c		45,000	Plant taken over		45,000
To Plant & machinery A/c		80,000	By Storm’s Capital A/c
To Bank A/c			Motor car taken over		30,000
Expenses	5,000		Stock taken over		5,000
Creditors	1,00,300	1,05,300	By bank A/c
To profit tfd.			Sundry Debtors		50,000
Cloud 5/10	13,260		Furniture & fixtures		40,000
Storm 3/10	7,956		Machinery		62,820
Rain 2/10	5,304	26,520	Stock		30,000
		3,82,820			3,82,820

Partners’ Capital Account
Particulars	Cloud	Storm	Rain	Particulars	Cloud	Storm	Rain
To Current A/c			3,000	By Balance b/d	60,000	40,000	30,000
To Realisation A/c				By current A/c	8,000	10,000
Assets taken over	45,000	30,000	5,000	By Realisation A/c	13,260	7,956	5,304
To Bank A/c	36,260	37,956	27,304
	81,260	57,956	35,304		81,260	57,956	35,304

Bank A/c
Particulars		Amount	Particulars		Amount
To balance b/d		14,000	By Realisation A/c
To Realisation A/c			Expenses		5,000
Sundry Debtors		50,000	Creditors		1,00,300
Furniture & fixtures		40,000	By cloud’s capital A/c		36,260
Machinery		62,820	By Storm’s capital A/c		27,956
Stock		30,000	By Rain’s capital A/c		27,304
		1,96,820			1,96,820

Comment if you have any questions
Also, Check out the solved question of previous Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

• Chapter No. 1 – Accounting Not for Profit Organisations
• Chapter No. 2 – Partnership Accounts – I (Introduction)
• Chapter No. 3 – Partnership Accounts – II (Goodwill: Nature and Valuation)
• Chapter No. 4 – Partnership Accounts – III (Reconstitution of Partnership)
• Chapter No. 5 – Partnership Accounts – IV (Admission of A Partner)
• Chapter No. 6 – Partnership Accounts – V (Retirement and Death of A Partner)
• Chapter No. 7 – Partnership Accounts – VI (Dissolution of Partnership Firm)
• Chapter No. 8 – Company Accounts (Share Capital)
• Chapter No. 9 – Company Accounts (Issue of Debentures)
• Chapter No. 10 – Company Accounts (Redemption of Debentures)

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

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

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