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प्रश्न
Hitesh sold goods for Rs 4,500 to Ashok on 1.1.2010 and drew upon him a bill of exchange payable 2 months after sight. Ashok accepted the bill and returned the same to Hitesh. On the due date the bill was met by Ashok.
Record the necessary Journal entries in the books of Hitesh and also prepare Ashok account in his books.
1. When the bill was retained by Hitesh till the date of its maturity.
2. When Hitesh immediately discounted the bill @ 15% p.a. with his bank.
3. When three days before its maturity, the bill was sent by Hitesh to his bank for collection.
4. When the bill was endorsed immediately by Hitesh in favour of his creditor Venkat.
उत्तर
Case -I
In the Books Of Hitesh
| Journal Entry | ||||
| Date | Particulars | L.F. |
Amount |
Amount (Rs.) |
| 2010 | ||||
| Jan. 01 | Ashok A/c Dr. | 4,500 | ||
| To Sales A/c | 4,500 | |||
| (Being Goods sold to Ashok) | ||||
| Jan .01 | Bills Receivable A/c Dr. | 4,500 | ||
| To Ashok A/c | 4,500 | |||
| (Being Bill accepted by Ashok) | ||||
| Mar.04 | Bank A/c Dr. | 4,500 | ||
| To Bills Receivable A/c | 4,500 | |||
| (Being honoured on maturity) | ||||
Case -II
In the Books Of Hitesh
| Journal Entry | ||||
| Date | Particulars | L.F. |
Amount |
Amount (Rs.) |
| 2010 | ||||
| Jan. 01 | Ashok A/c Dr. | 4,500 | ||
| To Sales A/c | 4,500 | |||
| (Being Goods sold to Ashok) | ||||
| Jan .01 | Bills Receivable A/c Dr. | 4,500 | ||
| To Ashok A/c | 4,500 | |||
| (Being Bill accepted by Ashok) | ||||
| Jan .01 | Bank A/c Dr. | 4,387 | ||
| Discount Charges A/c Dr. | 113 | |||
| To Bills Receivable A/c | 4,500 | |||
| (Bill discounted with bank @15% per annum.) | ||||
Case -III
In the Books Of Hitesh
| Journal Entry | ||||
| Date | Particulars | L.F. |
Amount |
Amount (Rs.) |
| 2010 | ||||
| Jan. 01 | Ashok A/c Dr. | 4,500 | ||
| To Sales A/c | 4,500 | |||
| (Being Goods sold to Ashok) | ||||
| Jan .01 | Bills Receivable A/c Dr. | 4,500 | ||
| To Ashok A/c | 4,500 | |||
| (Being Bill accepted by Ashok) | ||||
| Mar.01 | Bill Sent For Collection A/c Dr. | 4,500 | ||
| To Bills Receivable A/c | 4,500 | |||
| (Bill sent for Collection to Bank, 3 days before maturity) | ||||
| Mar.04 | Bank A/c Dr. | 4,500 | ||
| To Bill Sent For Collection A/c | 4,500 | |||
| (Bill sent for collection to bank, honoured on maturity) | ||||
Case -IV
In the Books Of Hitesh
| Journal Entry | ||||
| Date | Particulars | L.F. |
Amount |
Amount (Rs.) |
| 2010 | ||||
| Jan. 01 | Ashok A/c Dr. | 4,500 | ||
| To Sales A/c | 4,500 | |||
| (Being Goods sold to Ashok) | ||||
| Jan .01 | Bills Receivable A/c Dr. | 4,500 | ||
| To Ashok A/c | 4,500 | |||
| (Being Bill accepted by Ashok) | ||||
| Jan .01 | Venkat Dr. | 4,500 | ||
| To Bills Receivable A/c | 4,500 | |||
| (Bill endorsed to Venkat, a creditor) | ||||
| Dr. | Ashok’s Account | Cr. | |||||
| Date | Particulars | J.F. | Amount (Rs.) | Date | Particulars | J.F. | Amount (Rs.) |
| 2010 Jan.01 |
Sales A/c | 4,500 |
2010 Jan . 01 |
Bills Receivable A/c | 4,500 | ||
| 4,500 | 4,500 | ||||||
APPEARS IN
संबंधित प्रश्न
Madhav accepted a bill of Rs. 40,000 drawn by Kashinath at 3 months. Kashinath got the bill discounted with his bank for Rs. 39,000. Before the due date, Madhav approached Kashinath for renewal of the bill. It was agreed to pay Rs 30,000 immediately together with interest on the remaining amount at 10% p. a. for 3 months and for the balance Madhav accepted a new bill for 3 months. These arrangements were carried through. But afterwards Madhav became insolvent. Only 35% of the amount could be recovered from his estate.
1. Pass necessary Journal Entries in the books of 'Madhav'.
2. Prepare Madhav's A/c in the books of 'Kashinath'.
On 1st August, 2010 Swapnali sold goods to Swapnil on credit for Rs 20,000. And drew two bills of 60% and 40% of the amount due from Swapnil for 3 and 4 months period respectively. Swapnil accepted and return it to Swapnali immediately. On 1st September 2010 Swapnali send 3 months acceptance to her bank for collection and discounted 4 months acceptance with her bank @ 18% p.a.
On the due date of the respective bills Swapnil honoured 3 months acceptance for which bank debited Rs 50 as bank charges. On due date of 4 months acceptance Swapnil dishonoured for which Swapnali’s bank paid nothing charges Rs 100.
Pass the journal entries in the books of Swapnali and prepare Swapnil’s account in her ledger.
On 5th September, 2010 Prakash Patil accepted a bill of Rs 16,000 drawn by Chandu Chaudhari for 3 months. This bill was drawn for amount which Prakash Patil owed to Chandu Chaudhari. On same date Chandu Chaudhari purchased goods from Magan Mahajan for Rs 20,000 for this Chandu Chaudhari endorsed Prakash Patil’s acceptance in favour of Magan Mahajan and accepted 2 months bill for the balance due. On 5th October, 2010 Magan Mahajan discounted both the bill with his bank @ 12% p.a.
On the due date Prakash Patil’s honoured his acceptance while Chandu Chaudhari unable to meet the payment for his acceptance. Magan Mahajan’s bank paid noting charges Rs 100.
Pass Journal entries in the books of Magan Mahajan and also prepare Prakash Patil’s and Magan Mahajan ledger account in the books of Chandu Chaudhari.
Harbhajan draws a bill on Manmit for Rs 8,000 at 3 months. Manmit accepts and return to Harbhajan. Harbhajan then sends the bill towards his bank for collections.
On due date Manmit find himself unable to make payment of the bill and request Harbhajan to renew it. He accepted the proposal on the condition that Manmit should pay Rs 2,000 along with interest @ 15% p.a. in cash and should accepts new bill for the balance at 2 months. These arrangements were carried through. One month before Manmit retired his acceptance @ 12% p.a.
Give journal entries and Manmit’s Account in the books of Harbhajan.
On 1st April, 2011 Umakant draws a bill for Rs 25,000 on Laxmikant for 4 months period. The bill is accepted and returned to Umakant. On the same date Umakant discounted the bill with his bank @ 12% p.a.
Before due date Laxmikant finds himself unable the bill, hence required Umakant to renew the bill for further period of 2 months. Umakant agreed and he took the bill back from bank and received new acceptance for Rs 26,000 including interest. This new bill is duly honoured by Laxmikant on due date.
Write Journal of Umakant and Laxmikant for the above bill transactions.
On 1st June, 2010 Narayan draws a bill for Rs 50,000 on Chunilal for 4 months period.
The bill is duly accepted and returned to Narayan. One month after the date. Narayan discounted the bill with bank @ 18% p.a.
Before due date Chunilal dishonoured his acceptance. Bank paid noting charges Rs 1,125. Narayan requested to renew the bill for further period of 2 months. Narayan agreed he took the bill back from bank and received new acceptance for 40% amount of the bill with full amount of noting charges and cheque for 60% balance plus interest @ 12% p.a.
Before the due date Chunilal declared insolvent and 30% of the amount due could be recovered from his private estate.
Write Journal of Narayan and Chunilal for the above bill transactions.
On 1st Sept., 2010 Badrinath drew a bill of Rs 20,000 on Dinanath at 4 months. The bill was duly accepted by Dinanath. On 5th Sept., 2010 Badrinath endorsed the bill in favour of Somnath. However on 1st January, 2012 Dinanath approached to Badrinath and requested bill be renewed for a further period of 3 months at 15% p.a. Badrinath agreed and paid necessary money to Somnath. Before one month of the due date of the new bill Dinanath retired his acceptance @ 10% p.a.
Pass journal entries in the books Badrinath and Dinanath.
State the accounting treatment for:
Unrecorded assets
State the accounting treatment for :
Unrecorded liabilities
How will you deal with the Realisation expenses of the firm of Rashim and Bindiya in the following cases
1. Realisation expenses amounts to Rs 1,00,000,
2. Realisation expenses amounting to Rs 30,000 are paid by Rashim, a partner.
3. Realisation expenses are to be borne by Rashim for which he will be paid Rs 70,000 as remuneration for completing the dissolution process. The actual expenses incurred by Rashim were Rs 1,20,000.
All partners wish to dissolve the firm. Yastin, a partner wants that her loan of Rs 2,00,000 must be paid off before the payment of capitals to the partners. But, Amart, another partner wants that the capitals must be paid before the payment of Yastin’s loan. You are required to settle the conflict giving reasons.
Rose and Lily shared profits in the ratio of 2:3. Their Balance Sheet on March 31, 2017 was as follows:
Balance Sheet of Rose and Lily as on March 31, 2017
| Liabilities |
Amount (Rs.) |
Assets | Amount (Rs.) | Amount (Rs.) |
| Creditors | 40,000 | Cash | 16,000 | |
| Lily’s loan | 32,000 | Debtors | 80,000 | 76,400 |
| Profit and Loss | 50,000 |
Less: Provision for doubtful Debts |
3600 | |
| Capitals: | Inventory | 109,600 | ||
| Lily | 160,000 | Bills Receivable | 40,000 | |
| Rose | 240,000 | Buildings | 280,000 | |
| 522,000 | 522,000 |
Rose and Lily decided to dissolve the firm on the above date. Assets (except bills receivables) realised Rs 4,84,000. Creditors agreed to take Rs 38,000. Cost of Realisation was Rs 2,400. There was a Motor Cycle in the firm which was bought out of the firm’s money, was not shown in the books of the firm. It was now sold for Rs 10,000. There was a contingent liability in respect of outstanding electric bill of Rs 5,000, Bill Receivable taken over by Rose at Rs 33,000.
Show Realisation Account, Partners Capital Account, Loan Account and Cash Account.
Sanjay, Tarun and Vineet shared profit in the ratio of 3:2:1. On December 31,2017 their balance sheet was as follows:
Balance Sheet of Sanjay, Tarun and Vineet as on December 31, 2017
| Liabilities | Amt (Rs.) |
Amt (Rs.) |
Assets | Amt (Rs.) |
| Capitals: | 270,000 | Plant | 90,000 | |
| Sanjay | 100,000 | Debtors | 60,000 | |
| Tarun | 100,000 | Furniture | 32,000 | |
| Vineet | 70,000 | Stock | 60,000 | |
| Creditors | 80,000 |
Investments |
70,000 | |
| Bills payable | 30,000 | Bills receivable | 36,000 | |
| Cash in hand | 32,000 | |||
| 380,000 | 380,000 |
On this date the firm was dissolved. Sanjay was appointed to realise the assets. Sanjay was to receive 6% commission on the sale of assets (except cash) and was to bear all expenses of Realisation.
Sanjay realised the assets as follows: Plant Rs 72,000, Debtors Rs 54,000, Furniture Rs 18,000, Stock 90% of the book value, Investments Rs 76,000 and Bills receivable Rs 31,000. Expenses of Realisation amounted to Rs 4,500.
Prepare Realisation Account, Capital Accounts and Cash Account
The following is the Balance Sheet of Gupta and Sharma as on December 31,2017:
Balance Sheet of Gupta and Sharma as on December 31, 2017
| Liabilities | Amt (Rs.) |
Amt (Rs.) |
Assets | Amt (Rs.) |
| Sundry Creditors | 38,000 | Cash at Bank | 12,500 | |
| Mrs.Gupta’s loan | 20,000 | Sundry Debtors | 55,000 | |
| Mrs.Sharma’s loan | 30,000 | Stock | 44,000 | |
| Reserve fund | 6,000 | Bills Receivable | 19,000 | |
| Provision of doubtful debts | 4,000 | Machinery | 52,000 | |
| Investment | 38,500 | |||
| Capital : | 150,000 | Fixtures | 27,000 | |
| Gupta | 90,000 | |||
| Sharma | 60,000 | |||
| 248,000 | 248,000 |
The firm was dissolved on December 31, 2017 and asset realised and settlements of liabilities as follows:
(a) The Realisation of the assets were as follows:
| Rs. | |
| Sundry Debtors | 52,000 |
| Stock | 42,000 |
| Bills receivable | 16,000 |
| Machinery | 49,000 |
(b) Investment was taken over by Gupta at agreed value of Rs 36,000 and agreed to pay of Mrs. Gupta’s loan.
(c) The Sundry Creditors were paid off less 3% discount.
(d) The Realisation expenses incurred amounted to Rs 1,200.
Journalise the entries to be made on the dissolution and prepare Realisation Account, Bank Account and Partners Capital Accounts.
Pass Journal entries for the following:
(a) Realisation expenses amounted to ₹ 10,000 were paid by the firm on behalf of Alok, a partner, with whom it was agreed at ₹ 7,500.
(b) Realisation expenses amounted to ₹ 5,000. It was agreed that the firm will pay ₹ 2,000 and balance by Ravinder, a partner.
(c) Dissolution expenses amounted to ₹ 10,000 were paid by Amit, a partner, on behalf of the firm.
Pass Journal entries for the following at the time of dissolution of a firm:
(a) Sale of Assets − ₹ 50,000.
(b) Payment of Liabilities − ₹ 10,000.
(c) A commission of 5% allowed to Mr. X, a partner, on sale of assets.
(d) Realisation expenses amounted to ₹ 15,000. The firm had agreed with Amrit, a partner, to reimburse him up to ₹ 10,000.
(e) Z, an old customer, whose account for ₹ 6,000 was written off as bad in the previous year, paid 60% of the amount written off.
(f) Investment (Book Value ₹ 10,000) realised at 150%.
Pass Journal entries for the following transactions at the time of dissolution of the firm:
(a) Loan of ₹ 10,000 advanced by a partner to the firm was refunded.
(b) X, a partner, takes over an unrecorded asset (Typewriter) at ₹ 300.
(c) Undistributed balance (Debit) of Profit and Loss Account ₹ 30,000. The firm has three partners X,Y and Z.
(d) Assets of the firm realised ₹ 1,25,000.
(e) Y who undertakes to carry out the dissolution proceedings is paid ₹ 2,000 for the same.
(f) Creditors are paid ₹ 28,000 in full settlement of their account of ₹ 30,000.
X, Y and Z are partners in a firm sharing profits in the ratio of 3 : 2 : 1 respectively. The firm was dissolved on 1st March, 2013. After transferring assets (other than cash) and third party liabilities to the 'Realisation Account' you are provided with the following information:
(a) There was a balance of ₹ 18,000 in the firm's Profit and Loss Account.
(b) There was an unrecorded bike of ₹ 50,000 which was taken over by X.
(c) Creditors of ₹ 5,000 were paid ₹ 4,000 in full settlement of accounts.
Pass necessary Journal entries for the above at the time of dissolution of firm.
Rohit, Kunal and Sarthak are partners in a firm. They decided to dissolve their firm. Pass necessary Journal entries for the following after various assets (other than Cash and Bank) and the third party liability have been transferred to Realisation Account:
(a) Kunal agreed to pay off his wife's loan of ₹ 6,000.
(b) Total Creditors of the firm were ₹ 40,000. Creditors worth ₹ 10,000 were given a piece of furniture costing ₹ 8,000 in full and final settlement. Remaining Creditors allowed a discount of 10%.
(c) Rohit had given a loan of ₹ 70,000 to the firm which was duly paid.
(d) A machine which was not recorded in the books was taken over by Kunal at ₹ 3,000, whereas its expected value was ₹ 5,000.
(e) The firm had a debit balance of ₹ 15,000 in the Profit and Loss Account on the date of dissolution.
(f) Sarthak paid the realisation expenses of ₹ 16,000 out of his private funds, who was to get a remuneration of ₹ 15,000 for completing dissolution process and was responsible to bear all the realisation expenses.
Pradeep and Rajesh were partners in a firm sharing profits and losses in the ratio of 3 : 2. They decided to dissolve their partnership firm on 31st March, 2018. Pradeep was deputed to realise the assets and to pay off the liabilities. He was paid ₹ 1,000 as commission for his services. The financial position of the firm on 31st March, 2018 was as follows:
BALANCE SHEET as at 31st March, 2018
|
Liabilities |
Amount (₹) |
Assets |
Amount (₹) |
||
| Creditors |
80,000 |
Building | 1,20,000 | ||
| Mrs. Pradeep's Loan | 40,000 | Investment | 30,600 | ||
| Rajesh's Loan |
24,000 |
Debtors |
34,000 |
|
|
| Investment Fluctuation Fund |
8,000 |
Less: Provision for Doubtful Debts |
4,000 |
30,000 |
|
| Capital A/cs: | Bills Receivable | 37,400 | |||
| Pradeep |
42,000 |
|
Bank | 6,000 | |
| Rajesh |
42,000 |
84,000 |
Profit and Loss A/c | 8,000 | |
|
|
|
Goodwill |
4,000 |
||
|
2,36,000 |
2,36,000 |
||||
Following terms and conditions were agreed upon:
(a) Pradeep agreed to pay off his wife's loan.
(b) Half of the debtors realised ₹ 12,000 and remaining debtors were used to pay off 25% of the creditors.
(c) Investment sold to Rajesh for ₹ 27,000.
(d) Building realised ₹ 1,52,000.
(e) Remaining creditors were to be paid after two months, they were paid immediately at 10% p.a. discount.
(f) Bill receivables were settled at a loss of ₹ 1,400.
(g) Realisation expenses amounted to ₹ 2,500.
Prepare Realisation Account.
Bale and Yale are equal partners of a firm. They decide to dissolve their partnership on 31st March, 2019 at which date their Balance Sheet stood as:
| Liabilities | ₹ | Assets | ₹ | |
| Capital A/cs: | Building | 45,000 | ||
| Bale | 50,000 | Machinery | 15,000 | |
| Yale | 40,000 | 90,000 | Furniture | 12,000 |
| General Reserve | 8,000 | Debtors | 8,000 | |
| Bale's Loan A/c | 3,000 | Stock | 24,000 | |
| Creditors | 14,000 | Bank | 11,000 | |
| 1,15,000 | 1,15,000 | |||
(a) The assets realised were:
Stock ₹ 22,000; Debtors ₹ 7,500; Machinery ₹ 16,000; Building ₹ 35,000.
(b) Yale took over the Furniture at ₹ 9,000.
(c) Bale agreed to accept ₹ 2,500 in full settlement of his Loan Account.
(d) Dissolution Expenses amounted to ₹ 2,500.
Prepare the:
(i) Realisation Account; (ii) Capital Accounts of Partners;
(iii) Bale's Loan Account; (iv) Bank Account.
A, B and C were equal partners. On 31st March, 2019, their Balance Sheet stood as:
| Liabilities | Amount (₹) |
Assets | Amount (₹) |
|
| Creditors | 50,400 | Cash | 3,700 | |
| Reserve | 12,000 | Stock | 20,100 | |
| Capital A/cs: | Debtors | 62,600 | ||
| A | 40,000 | Loan to A | 10,000 | |
| B | 25,000 | Investments | 16,000 | |
| C | 15,000 | 80,000 | Furniture | 6,500 |
| Building | 23,500 | |||
| 1,42,400 | 1,42,400 | |||
The firm was dissolved on the above date on the following terms:
(a) For the purpose of dissolution, Investments were valued at ₹ 18,000 and A took over the Investments at this value.
(b) Fixed Assets realised ₹ 29,700 whereas Stock and Debtors realised ₹ 80,000.
(c) Expenses of realisation amounted to ₹ 1,300.
(d) Creditors allowed a discount of ₹ 800.
(e) One Bill receivable for ₹ 1,500 under discount was dishonoured as the acceptor had become insolvent and was unable to pay anything and hence the bill had to be met by the firm.
Prepare Realisation Account, Partner's Capital Accounts and Cash Account showing how the accounts would finally be settled among the partners.
Yogesh and Naresh were partners sharing profits equally. They dissolved the firm on 1st April, 2019. Naresh was assigned the responsibility to realise the assets and pay the liabilities at a remuneration of ₹10,000 including expenses. Balance Sheet of the firm as on that date was as follows:
|
Liabilities |
Amount (₹) |
Assets |
Amount (₹) |
||
| Creditors |
40,000 |
Cash/Bank | 6,000 | ||
| Bills Payable | 40,000 | Investments | 30,000 | ||
| Naresh's Loan |
44,000 |
Debtors |
40,000 |
|
|
| Mrs. Yogesh's Loan |
42,000 |
Less: Provision for Doubtful Debts |
4,000 |
36,000 |
|
| Investment Fluctuation Reserve | 8,000 | Bills Receivable | 33,400 | ||
| Capital A/cs: | Profit and Loss A/c | 1,10,600 | |||
| Yogesh |
21,000 |
|
|||
| Naresh |
21,000 |
42,000 |
|||
|
2,16,000 |
2,16,000 |
||||
The firm was dissolved on following terms:
(a) Yogesh was to pay his wife's loan.
(b) Debtors realised ₹ 30,000.
(c) Naresh was to take investments at an agreed value of ₹ 26,000.
(d) Creditors and Bills Payable were payable after two months but were paid immediately at a discount of 15% p.a.
(e) Bills Receivable were received allowing 5% rebate.
(f) A Debtor previously written off as Bad Debt paid ₹ 15,000.
(g) An unrecorded asset realised ₹10,000.
Prepare Realisation Account, Partners' Capital Accounts, Partners' Loan Account and Cash/Bank Account.
A, B and C were partners sharing profits in the ratio of 5 : 3 : 2. On 31st March, 2019, A's Capital and B's Capital were ₹ 30,000 and ₹ 20,000 respectively but C owed ₹ 5,000 to the firm. The liabilities were ₹ 20,000. The assets of the firm realised ₹ 50,000.
Prepare Realisation Account, Partner's Capital Accounts and Bank Account.
Ashok and Kishore were in partnership sharing profits in the ratio of 3 : 1. They agreed to dissolve the firm. The assets (other than cash of ₹ 2,000) of the firm realised ₹ 1,10,000. The liabilities and other particulars on that date were:
| Creditors | ₹ 40,000 | |
| Ashok's Capital | ₹ 1,00,000 | |
| Kishore's Capital | ₹ 10,000 | (Dr. Balance) |
| Profit and Loss A/c | ₹ 8,000 | (Dr. Balance) |
| Realisation Expenses | ₹ 1,000 |
You are required to close the books of the firm.
A, B and C started business on 1st April, 2018 with capitals of ₹ 1,00,000; ₹ 80,000 and ₹ 60,000 respectively sharing profits (losses) in the ratio of 4 : 3 : 3. For the year ended 31st March, 2019, the firm suffered a loss of ₹ 50,000. Each of the partners withdrew ₹ 10,000 during the year.
On 31st March, 2019, the firm was dissolved, the creditors of the firm stood at ₹ 24,000 on that date and Cash in Hand was ₹ 4,000. The assets realised ₹ 3,00,000 and Creditors were paid ₹ 23,500 in full settlement of their claims.
Prepare Realisation Account and show your workings clearly.
A, B and C were in partnership sharing profits and losses in the ratio of 2 : 1 : 1. They decided to dissolve the partnership. On that date of dissolution, Sundry Assets (including cash ₹ 5,000) amounted to ₹ 88,000, assets realised ₹ 80,000 (including an unrecorded asset which realised ₹ 4,000). A contingent liability on account of bills discounted ₹ 8,000 was paid by the firm. The Capital Accounts of A, B and C showed a balance of ₹ 20,000 each.
Prepare Realisation Account, Partners' Capital Accounts and Cash Account.
The partnership between A and B was dissolved on 31st March, 2019. On that date the respective credits to the capitals were A − ₹ 1,70,000 and B − ₹ 30,000. ₹ 20,000 were owed by B to the firm; ₹ 1,00,000 were owed by the firm to A and ₹ 2,00,000 were due to the Trade Creditors. Profits and losses were shared in the proportions of 2/3 to A, 1/3 to B.
The assets represented by the above stated net liabilities realise ₹ 4,50,000 exclusive of ₹ 20,000 owed by B. The liabilities were settled at book figures. Prepare Realisation Account, Partners' Capital Accounts and Cash Account showing the distribution to the partners.
X, Y and Z entered into partnership on 1st April, 2016. They contributed capital ₹ 40,000, ₹ 30,000 and ₹ 20,000 respectively and agreed to share profits in the ratio of 3 : 2 : 1. Interest on capital was to be allowed @ 15% p.a. and interest on drawings was to be charged at an average rate of 5%. During the two years ended 31st March, 2018, the firm made profit of ₹ 21,600 and ₹ 25,140 respectively before allowing or charging interest on capital and drawings. The drawings of each partner were ₹ 6,000 per year.
On 31st March, 2018, the partners decided to dissolve the partnership due to difference of opinion. On that date, the creditors amounted to ₹ 20,000. The assets, other than cash ₹ 2,000, realised ₹ 1,21,000. Expenses of dissolution amounted to ₹ 760.
Draw up necessary Ledger Accounts to close the books of the firm.
