Question 32 Chapter 7 of +2 Part-1 – USHA Publication 12 Class Part – 1

Question 32 Chapter 7 of +2- Part

Question 32 Chapter 7 of +2-Part-1

Free Accounting book Solution - Class 11 and Class 12

32. (Realisation A/c/Partner’s Capital A/c/Cash A/e) D, E and F sharing profits in th proportion of 3 :2: 1 agree upon dissolution of the firm, D was appointed to realize the assets and pay off the liabilities for which he was entitled to a lump sum amount of Rs. 1,000 The Balance sheet of the firm on 31st March, 2019 was as follows-

Liabilities  Rs. Assets  Rs. 
Capital A/c :   Machinery  40,500
D 50,000 Stock  7,500
E 20,000 Investments  20,000
Creditors 18,500 Debtors                 9,300  
Investment fluctuations fund 6,000 Less provision       600 8,700
    F’s current A/c 11,500
    Cash  6,300
  94,500   94,500

The investments are taken over by D for Rs. 18,000. E takes over all the stock at Rs. 7,000 and debtors amounting to Rs. 5,000 at Rs. 4,500. Machinery is sold for Rs. 55,000. The remaining debtors realize 50% of the book value D is to be allowed Rs. 1,000 for realizing the asset and payment of liabilities. The actual expenses of realisation amounted to Rs. 600.
Show the necessary ledger accounts on the completion of dissolution of the firm .

The solution of Question 32 Chapter 7 of +2 Part-1: –

Revaluation A/c
Particulars
Amount Particulars Amount
To Debtors   9,300 By provision for doubtful debts   600
To Stock A/c   7,500 By Creditors   18,500
To investments   20,000 By investment fluctuations fund   6,000
To Machinery   40,500 By D’s capital A/c   18,000
To Cash Creditors   18,500 By E’s capital A/c    
To D’s Remuneration   1,000 Stock 7,000  
To profit on realisation     Debtors 4,500 11,500
D‘s Capital A/c 7,475   By cash    
E‘s capital A/c 4,983   Machinery 55,000  
F’s capital A/c 2,492 14,950 Debtors (50% of 4,300) 2,150 57,150
    1,11,750     1,11,750
Partners’ Capital Account 
 
Particulars D E F Particulars D E F
To Current A/c     11,500 By Balance b/d 50,000 20,000  
To Realisation A/c – –       By realisation A/c      
Assets taken over 18,000 11,500   Realisation fee 1,000    
To Cash (drawing for exp.) 600     By realisation A/c      
        Realisation profit 7,475 4,983 2,492
To Cash BF 39,8750 13,483   By Cash BF     9,008
  58,475 24,983 11,500   58,475 24,983 11,500
Cash A/c
Particulars Amount Particulars Amount
To balance b/d   6,300 By Realisation A/c creditor paid   18,500
To Realisation A/c     By D’s capital A/c Drawing for exp.   600
Assets realised   57,150 By D’s capital A/c discharge   39,875
To F’s capital A/c   9,008 By E’s capital A/c   13,483
    72,458     72,458

Note : expenses of realised are to be born by D , but firm incurred realization expenses ; i.e. , on behalf of D hence for that firm will pass additional entry

D’s capital A/c Dr 600  
To Cash A/c     600


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 32 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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