Advertisements
Advertisements
Question
On dissolution of the partnership firm of A, B and C, the accumulated profits of ₹ 40,000 will be transferred to which of the following account?
Options
Revaluation Account
Realisation Account
Partners' Capital Account
Bank Account
Solution
Partners' Capital Account
Explanation:
On dissolution of partnership firm, reserve or accumulated profits appearing in the books of the firm is credited to the Partners' Capital Accounts.
APPEARS IN
RELATED QUESTIONS
Jayant and Ramakant were partners in the firm. On 31st March 2013 their Balance Sheet was as follows:
| Balance Sheet of Jayant and Ramakant as on 31st March 2013 | |||
| Liabilities | Amount (Rs) | Assets | Amount (Rs) |
|
Creditors Workman Compensation Fund Satya’s Current Account Capital's: Jayant Ramaknat |
75,000 45,000 15,000
|
Bank Debtors Stock Furniture Machinery Shanti’s Current Account |
70,000 2,00,000 20,000 20,000 3,12,000 13,000 |
|
|
6,35,000 |
|
6,35,000 |
On the above date the firm was dissolved:
1. Jayant took over 40% of the stock at 20% less than its book value and the remaining stock was sold for Rs 15,000. Furniture realized Rs 20,000.
2. An unrecorded asset was sold for Rs 3,000. Machinery was sold at a loss of Rs 75,000.
3. Debtors realized Rs 10,000.
4. There was an outstanding bill for repairs for which Rs 38,000 were paid.
Prepare Realisation Account
Hanif and Jubed were partners in a firm sharing profits in the ratio of their capitals. On the 31st March 2013 their Balance Sheet was as follows:
| Balance Sheet of Hanif and Jubed as on 31st March 2013 | |||
| Liabilities | Rs | Assets | Rs |
|
Creditors Workman Companion Fund General Reserve Hanif’s Current Account Capital's: Hanif 10,00,000 Jubed 5,00,000 |
1,50,000 3,00,000 75,000 25,000
15,00,000 |
Bank Debtors Stock
Furniture Machinery Jubed’s Current Account |
2,00,000 3,40,000 1,50,000
4,60,000 8,20,000 80,000 |
| 20,50,000 | 20,50,000 | ||
On the above date the firm was dissolved:
a. Debtors were realised at a discount of 5%, 50% of the stock was taken over by Hanif at 10% less than the book value. Remaining stock was sold for Rs 65,000.
b. Furniture was taken over by Jubed for Rs 1,35,000. Machinery was sold as scrap for Rs 74,000.
c. Creditors were paid in full.
d. Expenses on realisation Rs 8,000 were paid by Hanif.
Prepare Realisation Account.
Pass the necessary journal entries for the following transaction of the dissolution of the firm of James and Haider who were sharing profits and losses in the ratio of 2 : 1.
The various assets (other than cash) and outside liabilities have been transferred to Realisation Account:
(i) James agreed to pay off his brother’s loan Rs 10,000
(ii) Debtors realized Rs 12,000
(iii) Haider took over all investment at Rs 12,000
(iv) Sundry creditors Rs 20,000 were paid at 5% discount
(v) Realisation expenses amounted to Rs 2,000
(vi) Loss on realization was Rs 10,200.
Which accounts are not transferred to Realisation Account?
Who is called Insolvent person?
In what proportion is the balance on Realisation Account transferred to Partner's Capital Account?
Which account is debited on payment of dissolution expenses?
Consider the following statements
Statement 1: At the time of dissolution of Partnership Firm all assets should be transferred to Realisation A/c.
Statement 2: All assets except the cash or bank balances are transferred to the Realisation Account.
Where would the interest on capital be recorded if the fixed capital account is followed in the partnership firm?
On taking responsibility for payment of a liability of ₹ 50,000 by a partner, the account credited will be:
On dissolution, the balance of 'Profit and Loss Account' appearing on the Assets side of the Balance Sheet is transferred to:
At the time of dissolution of partnership firm, the amount of 'Bills Payable' shown in the Liabilities Side of the Balance Sheet is transferred to:
Pick the odd one out:
At the time of dissolution of the firm, "Loan of partners" (Loans given by partners to the firm) is paid out of the amount realised on the sale of assets:
On dissolution, the final balance of the Partner's Capital Account is transferred to ______.
If goodwill is already appearing in the books of accounts at the time of retirement of a partner, then it should be written off in ______.
On dissolution of a firm, realisation account is debited with:
Give the necessary Journal entries for the following transactions on dissolution of the firm of Sonu and Monu on 31st March, 2021, after transfer of various assets (other than cash and bank balance) and the third party liabilities to Realisation Account. They shared profits and losses in the ratio of 2 : 1.
- Sonu agreed to take over the firm's goodwill (not recorded in the books of the firm) at a valuation of ₹ 40,000.
- Bills payable of ₹ 30,000 falling due on 30th April, 2021 were discharged at ₹ 29,550.
- Stock worth ₹ 8,00,000 was taken over by partner, Sonu at 10% discount.
- Creditors off ₹ 2,00,000 accepted machinery valued at ₹ 2,20,000 in full settlement of their claim.
- Expenses of realisation ₹ 10,000 were paid by partner, Sonu.
C, D, E were partners in a firm sharing profits in the ratio of 3 :1: 1. Their Balance Sheet as at 31st March, 2022 were as follows:
| Balance Sheet of C, D and E as at 31st March,2022 | ||||
| Liabilities | Amount (₹) | Amount (₹) | Assets | Amount (₹) |
| Capitals: | Machinery | 3,20,000 | ||
| C | 4,00,000 | 7,00,000 | Investments | 3,00,000 |
| D | 2,00,000 | Stock | 2,00,000 | |
| E | 1,00,000 | Debtors | 1,00,000 | |
| C's Loan | 1,20,000 | Cash at Bank | 2,00,000 | |
| Sundry Creditors | 1,00,000 | |||
| Bills Payable | 2,00,000 | |||
| 11,20,000 | 11,20,000 | |||
On the above date the firm was dissolved due to certain disagreements among the partners:
- Machinery of ₹ 3,00,000 were given to creditor in full settlement of their amount and remaining machinery was sold for ₹ 10,000.
- Investments realised ₹ 2,90,000.
- Stock was sold for ₹ 1,80,000.
- Debtors for ₹ 20,000 proved bad.
- Realisation expenses amounted at ₹ 10,000
Prepare Realisation Account.
