Question

P,Q,R and S had been carrying on business in partnership sharing profit and losses in

the ration of 4:3:2:1 .They decided to dissolve the partnership on the basis of

following Balance Sheet as on 30th April,2011:

(1) The assets were realized as under :

Land and Building 2,30,000

Furniture & Fixture 42,000

Stock 72,000

Debtors 65,000

(2) Expenses of dissolution amounted to Rs.7,800

(3) Further creditors of Rs.18,000 and had to be met

(4) R became insolvent and nothing was realized from his private estate.

Applying the principles laid down in Garners vs. Murray, prepare the Realisation

Account, Partner’s Capital Account and Cash Account.

Q​

Answer 1

Liabilities

Capital Account:

1,68,000

1.08.000 General Reserve Capital Reserve Sundry Creditor Mortgage Loan

(1)

(2) (3) (4)

Amount (Rs.)

2,76,000

95.000

25.000 36,000 1,10,000

5,42,000

The assets were realized as under: Land and Building Furniture & Fixture

Stock

Assets

Land and Building Furniture and Fixture Stock Debtors Cash in hand Capital Overdrawn :

25,000

18.000

Debtors Expenses of dissolution amounted to Rs.7.800 Further creditors of Rs. 18,000 and had to be met R became insolvent and nothing was realized from his private estate.

Amount (Rs.)

2,46,000

65.000 72,500 15,500

43,000 5,42,000

2.30,000 42,000 72,000 65,000

Applying the principles laid down in Garners vs. Murray, prepare the Realisation Account, Partner's Capital Account and Cash Account.