Question

A and B are partners in a firm sharing profits and losses in the ratio of 3 : 2. On 31st March, 2018, their Balance Sheet was as follows:
The firm was dissolved on 31st March, 2018 and both the partners agreed to the following:
(a) A took Investments at an agreed value of ₹ 8,000. He also agreed to settle Mrs. A’s Loan.
(b) Other assets realised as : Stock – ₹ 5,000; Debtors – ₹ 18,500; Furniture – ₹ 4,500; Plant – ₹ 25,000.
(c) Expenses of realisation came to ₹ 1,600.
(d) Creditors agreed to accept ₹ 37,000 in full settlement of their claims.
Prepare Realisation Account, Partners Capital Accounts and Bank Account.

Answer 1

The Realisation Account, Partners Capital Accounts and Bank Account are calculated and prepared below:

Explanation:

REALISATION ACCOUNT:

Particulars (Dr.)

To Stock A/c - Rs. 6000

To Debtors A/c  - Rs. 19000

To Furniture A/c  - Rs. 4000

To Plant A/c  - Rs.28000

To Investment A/c - Rs. 10000

To A's Capital A/c: (Mrs. A's Loan)  - Rs. 10000

To Bank A/c:

• Creditors  - Rs. 37000
• Expenses - Rs. 1600

Total = Rs. 38,600

Adding all, we get

= 6000+ 19000 + 4000 + 28000 + 10000 + 10000 + 38600

= Rs, 1,15,600

Particulars (Cr.)

By Creditors A/c  - Rs. 38000

By Mrs. A's Loan A/c  - Rs. 10000

By A's Capital A/c  - Rs. 8000

By Bank A/c:

• Stock  - Rs. 5000
• Debtors  - Rs. 18500
• Furniture  - Rs. 4500
• Plant  - Rs. 25000

Total = Rs. 53000

By Loss transferred to:

• A's Capital A/c  - Rs. 3960
• B's Capital A/c - Rs. 2640

Total = Rs. 6600

Adding all, we get

= 38000 + 10000 + 8000 + 53000 + 6600 = Rs. 1,15,600

The Partners Capital Accounts and Bank Account are calculated and prepared below: