Question 31 Chapter 7 of +2 Part-1 – USHA Publication 12 Class Part – 1

Question 31 Chapter 7 of +2- Part

Free Accounting book Solution - Class 11 and Class 12

Question 31 Chapter 7 of +2-Part-1

31. (Realisation A/c/Capital A/c’s/Bank A/e) Following was the Balance Sheet of Fox Wolf as at 31 March 2015, when they decided to dissolve the firm :

Liabilities  Rs. Assets  Rs. 
Creditors  88,500 Cash at bank  4,500
Capital A/c   Stock 18,000
Fox  30,000 Debtors 42,000
Wolf  24,000 Furniture  12,000
Ms. Wolf’s Loan  40,000 Machinery  1,06,500
Bills payable  23,000 Profit & Loss A/c  22,500
  2,05,500   2,05,500

The assets realised stock Rs. 10,500. Debtors 27,750, Machinery Rs. 89,000 Furniture was taken by Fox at Rs. 7,500. Bills payable were paid in full, while creditors were settled at 2% discount. Ms. Wolf accepted Rs. 38,500 in full settlement of her loan account There was claim for damages against the firm for Rs. 4,000 which was settled at Rs. 2,000.
One customer, whose account was written off as bad, now paid Rs. 1,800, which is not include in Rs. 27,750 given above actual realisation expenses amounted to Rs. 2,100.
Prepare the Realisation Account, Partner’s Capital Account and Bank Account to close the books of the firm.

The solution of Question 31 Chapter 7 of +2 Part-1: –

Revaluation A/c
Particulars
Amount Particulars Amount
To Sundry Assets Transfer     By Sundry liabilities    
To Stock A/c 18,000   Transfer creditors A/c 88,500  
Debtors A/c 42,000   Bills payable A/c 23,000  
Furniture 12,000   Ms. Wolf A/c 40,000 1,51,500
Machinery A/c 1,06,500 1,78,500 By Bank A/c    
To Bank A/c     Assets realised    
Liabilities paid off     Stock 10,500  
Bills payable 23,000   Debtors 27,750  
Creditors 86,730   Machinery 89,000 1,27,250
Mrs. Wolf     By Fox ’s capital A/c    
Loan 38,500   Furniture taken over   7,500
Claim for damages 2,000 1,50,230 By Bank A/c (recovery for bad debts )   1,800
To Bank A/c Expenses   2,100 By loss on realisation    
      Fox ’s capital A/c 21,390  
      Wolf ’s capital A/c 21,390 42,780
    3,30,830     3,30,830
Partners’ Capital Account 
Particulars Fox Wolf Particulars Fox Wolf
To Profit & loss A/c 11,250 11,250 By Balance b/d 30,000 24,000
To Realisation A/c – –     By Bank A/c 10,140 8,640
Furniture taken over 7,500        
To Realisation A/c – loss 21,390 21,390      
           
  40,140 32,640   40,140 32,640
Bank A/c
Particulars Amount Particulars Amount
To balance b/d   4,500 By Realisation A/c   1,50,230
To Realisation A/c     By Bank A/c   2,100
Assets realised 1,27,250        
Recovery for bad debts 1,800 1,29,050      
To Fox ’s capital A/c (cash brought in )   10,140      
To Wolf’s capital A/c (cash brought in )   8,640      
           
           
    1,52,330     1,52,330

Note : 1. Profit sharing ratio is not given . Therefore , profit/losses shall be shared equally .
2. Claim for damages was Rs. 4,000 but it was settled for Rs. 2,000 . Therefore , Rs. 2,000 shall be debited to Realisation Account .

Also, Check out the solved question of previous Chapters: –

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

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

Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication

2 Book 1 min - Question 31 Chapter 7 of +2 Part-1 - USHA Publication 12 Class Part - 1
Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firm

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