The following is the Balance Sheet of X and Y as at 30th June, 2022. Sundry Creditors ₹ 20,000 Bills Payable ₹ 20,000
The following is the Balance Sheet of X and Y as at 30th June, 2022.
The firm was dissolved on 30th June, 2022 and the following arrangements were decided upon:
(a) X agreed to pay off his brother’s loan;
(b) Debtors realised ₹ 12,000;
(c) Y took over all the investments at ₹ 12,000.
(d) Other assets realised as follows:
Plant – ₹ 20,000, Building – ₹ 50,000, Goodwill – ₹ 6,000
(e) Sundry Creditors and Bills payable were settled at 5% discount, Y accepted stock at ₹ 8,000 and X took over Bills Receivable at 20% discount.
(f) Realisation Expenses amounted to ₹ 2,000.
You are required to pass Journal Entries.
[Ans. Gain on Realisation ₹ 9,800; Final Payment to X ₹ 35,900 and Y ₹ 3,900; Total of Bank A/c ₹ 1,01,000.]
| Liabilities | ₹ | Assets | ₹ |
| Sundry Creditors | 20,000 | Goodwill | 10,000 |
| Bills Payable | 20,000 | Buildings | 25,000 |
| Bank Overdraft | 8,000 | Plant | 25,000 |
| Outstanding Expenses | 2,000 | Investments | 15,300 |
| X’s brother’s Loan | 20,000 | Stock | 8,700 |
| Y’s Loan | 10,000 | Debtors 17,000 Less: Provision 2,000 | 15,000 |
| Investment Fluctuation Fund | 2,800 | Bills Receivable | 10,000 |
| Employee’s Provident Fund | 1,200 | Cash at Bank | 13,000 |
| General Reserve | 2,000 | Profit and Loss A/c (Dr. Balance) | 4,000 |
| X’s Capital Y’s Capital | 20,000 20,000 | ||
| 1,26,000 | 1,26,000 |
Anurag Pathak Answered question 6 days ago
