Question

Adit and Shiv were partners sharing profits and losses in the ratio of 5 : 4. They dissolved their partnership firm on 31^st March 2023, when their Balance Sheet showed the following balances:

Particulars	(₹)
Adit's Capital	40,000
Shiv's Capital	30,000
Adit's Current A/c (Cr.)	3,000
Shiv's Current A/c (Dr.)	6,000
Loan by the firm to Shiv	22,000
Profit & Loss Account (Dr.)	4,500

On the date of dissolution of the firm:

1. The firm suffered a loss of ₹ 18,000 upon realisation of assets and settlement of liabilities.
2. The expenses of dissolution of ₹ 3,000, to be borne by Shiv, were paid by the firm on his behalf.
3. The firm had furniture of ₹ 15,000. Adit took over some pieces of the furniture at ₹ 9,000 (being 10% less than the book value). Shiv took over the remaining furniture at 80% of its book value.

You are required to prepare the Partners Capital Accounts.

Answer 1

Dr.	Partners Capital Accounts as on 31st  March 2023				Cr.
Particulars	Adit (₹)	Shiv (₹)	Particulars	Adit (₹)	Shiv (₹)
To Shiv's Current A/c	-	6,000	By Balance b/d	40,000	30,000
To Shiv's Loan A/c	-	22,000	By Adit's Current A/c	3,000	-
To Profit & Loss A/c	2,500	2,000	By Cash/Bank A/c	-	15,000
To Loss on Realisation A/c	10,000	8,000
To Bank A/c (dissolution expenses)	-	3,000
To Realisation A/c (furniture taken over)	9,000	4,000
To Cash/Bank A/c	21,500	-
	43,000	45,000		43,000	45,000

Working Notes:

Let value of furniture taken over by Adit be x

`x-(10x)/100 = 9,000`

`(90x)/100=9,000`

90x = 9,00,000

`x = (9,00,000)/90`

x = 10,000

Value of furniture taken over by Shiv

= 15,000 − 10,000 = 5,000

Value at which shiv took over furniture = `5,000xx80/100` = ₹ 4,000