Question

7 The Firm of Rohan, Kishan and Sohan dissolved on 31.3.2020. Pass
necessary Journal entries for the following after various assets (other than
cash and bank) and the third-party liabilities had been transferred to
Realisation Account.
(a) Total Creditors of the firm were 340,000. 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%.
(b) Rohan agreed to take over the responsibility of completing dissolution at an
agreed remuneration of 1,000 and to bear all realisation expenses
Actual realisation expenses 800 were paid by the firm.
(c) Sohan's loan of 28,000 was settled at 325,000.
(d) Kishan agreed to take over the firm's goodwill (not recorded in the books)
at a valuation of 30,000.​

Answer 1

Answer:

(a) Realisation A/C.... Dr. 6000

To Kunal's Capital A/C 6000

(Being Kunal's wife's loan discharged off by Kunal)

(b) Realisation A/C.... Dr. 27000

To Bank A/C 27000

(Being creditors [30000 - 10%] paid off)

(c) Rohit's Loan A/C.... Dr. 70000

To Bank A/C 70000

(Being Rohit's loan paid off)

(d) Kunal's Capital A/C.... Dr. 3000

To Realisation A/C 3000

(Being unrecorded asset taken over by Kunal)

(e) Rohit's Capital A/C.... Dr. 5000

Kunal's Capital A/C.... Dr. 5000

Sarthak's Capital A/C.... Dr. 5000

To Profit and Loss A/C 15000

(Being profit and loss transferred to the partner's capital accounts)

(f) Realisation A/C.... Dr. 15000

To Sarthak's Capital A/C 15000

(Being remuneration paid to Sarthak for realisation expenses)