Karam, Burman and Chaman are three partners sharing profits in the ratio of 3 : 1 : 1. On 31st March, 2023
Karam, Burman and Chaman are three partners sharing profits in the ratio of 3 : 1 : 1. On 31st March, 2023, they decided to dissolve their firm. On that date their Balance Sheet was as under:
| Liabilities | ₹ | Assets |  | ₹ |
|
Creditors Loan General Reserve Capital A/cs: Karam Burman Chaman |
6,000 1,500 10,000 24,500 9,000 6,000 |
Cash at Bank Debtors Less: PDD Stock Furniture Sundry Assets Advertisement Suspense A/c |
24,200 1,200 |
3,200
23,000 7,800 1,000 17,000 5,000 |
| Â | 57,000 | Â | Â | 57,000 |
It is agreed that:
(i) Karam is to take over Furniture at ₹ 200 less, and Debtors amounted to ₹ 20,000 at ₹ 17,200; the Creditors of ₹ 6,000 to be paid by his at this amount.
(ii) Burman is to take over all the stock at ₹ 7,000 and some of the Sundry Assets at ₹ 7,200 (being 10% less than book value)
(iii) Chaman is to take the remaining Sundry Assets at 90% of the book value, less ₹ 100 as discount and assume the responsibility for the discharge of the loan together with accrued interest of ₹ 30 which has not been recorded in the books.
(iv) Remaining Debtors were sold to a debt-collecting agency for 50% of the book value.
(v) Karam was to receive ₹ 270 as remuneration for completing the dissolution work and was to bear the realisation expenses. The expenses of realisation ₹ 500 were paid by Karam.
Prepare necessary accounts to close the books of the firm.
Anurag Pathak Changed status to publish February 11, 2024
