A, B and C sharing profits in the proportion of 3 : 2 : 1 agreed upon dissolution of their partnership firm on 31st March, 2024 on which date their balance sheet was as under:
A, B and C sharing profits in the proportion of 3 : 2 : 1 agreed upon dissolution of their partnership firm on 31st March, 2024 on which date their balance sheet was as under:
| Liabilities | ₹ | Assets | ₹ |
|
Capital A/cs: A B |
40,000 20,000 | Machinery | 40,500 |
| Mrs. A’s Loan | 10,000 | Stock-in-trade | 7,550 |
| Creditors | 18,500 | Investments | 20,000 |
| Investments Fluctuation Fund | 6,000 | Accrued Income | 830 |
| Â | Â |
Debtors 9,300 Less: Provision for Doubtful Debts 600 |
8,700 |
| Â | Â | Current A/c – C | 11,500 |
| Â | Â | Cash at Bank | 5,420 |
| Â | 94,500 | Â | 94,500 |
 The investments are taken over by A for ₹ 17,500. A agrees to discharge his wife’s loan. B takes over all the stock at ₹ 7,000 and debtors amounting to ₹ 5,000 at ₹ 4,000. Machinery is sold for ₹ 67,000. The remaining debtors realise 50% of book value. The expenses of realisation amount to ₹ 600. It is found that an investment not recorded in the books is worth ₹ 3,000 and it is taken over by one of the creditors at this value. Show the necessary ledger accounts on completion of the dissolution of firm.
[Ans. Gain on realisation ₹ 28,470; Cash brought in by C ₹ 6,755; Payment to A ₹ 46,735 and B ₹ 18,490. Total of Bank A/c ₹ 81,325.]
Anurag Pathak Answered question September 25, 2024
Solution:-
Notes:-
(1) C’s Current A/c appears on the assets side, which means that is has a debit balance. As such, it will be transferred to the Debit Side of C’s Capital Account.
(2) Accrued income will not be realised.
Anurag Pathak Changed status to publish September 27, 2024
