TextBook Solutions for Jammu and Kashmir State Board of School Education Class 12 Accountancy Accountancy Part I Chapter 5 Dissolution Of Partnership Firm

Bora, Singh and Ibrahim were partners in a firm sharing profits in the ratio of 5: 3: 1. On 2-3-2015 their firm was dissolved. The assets were realized and the liabilities were paid off. Given below are the Realisation Account, Partners' Capital Account and Bank Account of the firm. The accountant of the firm left a few amounts unposted in these accounts. You are required to complete these accounts by posting the correct amounts.

Distinguish between 'Dissolution of Partnership' and Dissolution of Partnership Firm' on the basis of closure of books.

Shanti and Satya were partners in a firm sharing profits in the ratio of 4:1. On 31^st March, 2013 their Balance Sheet was as follows:

On the above date the firm was dissolved:
(1) Shanti took over 40% of the stock at 10% less than its book value and the remaining stock was sold for Rs 40,000. Furniture realized Rs 80,000.
(2) An unrecorded investment was sold for Rs 20,000. Machinery was sold at a loss of Rs 60,000.
(3) Debtors realized Rs 55,000.
(4) There was an outstanding bill for repairs  for which Rs 19,000 were paid. Prepare Realisation Account.

Shanti and Satya were partners in a firm sharing profits in the ratio of 4:1. On 31^st March, 2013 their Balance Sheet was as follows:

On the above date the firm was dissolved:
(1) Shanti took over 40% of the stock at 10% less than its book value and the remaining stock was sold for Rs 40,000. Furniture realized Rs 80,000.
(2) An unrecorded investment was sold for Rs 20,000. Machinery was sold at a loss of Rs 60,000.
(3) Debtors realized Rs 55,000.
(4) There was an outstanding bill for repairs  for which Rs 19,000 were paid. Prepare Realisation Account.

Pass the necessary Journal entries for the following transactions on the dissolution of the firm of P and Q after the various assets (other than cash) and outside liabilities have been transferred to Realisation Account.
(i) Bank Loan Rs. 12,000 was paid.
(ii) Stock worth Rs. 16,000 was taken over by partner Q.
(iii) Partner P paid a creditor Rs. 4,000.
(iv) An asset not appearing in the books of accounts realised Rs. 1,200.
(v) Expenses of realisation Rs. 2,000 were paid by partner Q.
(vi) Profit on realisation Rs. 36,000 was distributed between P and Q in 5:4 ratio.

Distinguish between 'Dissolution of Partnership' and 'Dissolution of Partnership Firm on the basis of 'Economic Relationship'.

L and M were partners in a firm sharing profits in the ratio of 2:3. On 28-2-2016 the firm was dissolved. After transferring assets (other than cash) and outsiders' liabilities to realization account you are given the following information:
(a) A creditor for ₹ 1,40,000 accepted building valued at ₹ 1,80,000 and paid to the firm ₹ 40,000.
(b) A second creditor for ₹30,000 accepted machinery valued at ₹28,000 in full settlement of his claim.
(c) A third creditor amounting to ₹70,000 accepted ₹30,000 in cash and investments of the book value of ₹45,000 in full settlement of his claim.
(d) Loss on dissolution was ₹4,000.
Pass necessary journal entries for the above transactions in the books of the firm assuming that all payments were made by cheque.

Pass necessary journal entries on the dissolution of a partnership firm in the following cases:

(i) Expenses of dissolution were ₹ 9,000.
(ii) Expenses of dissolution ₹ 3,400 were paid by a partner, Vishal.
(iii) Shiv, a partner, agreed to do the work for dissolution for a commission of ₹ 4,500. He also agreed to bear the dissolution expenses. Actual dissolution expenses ₹ 3,900 were paid from the firm's bank account.
(iv) Naveen, a partner, agreed to look after the dissolution work for which he was allowed a remuneration of ₹ 3,000. Naveen also agreed to bear the dissolution expenses. Actual expenses on dissolution ₹ 2,700 were paid by Naveen.
(v) Vivek, a partner, was appointed to look after the dissolution work for a remuneration of ₹ 7,000. He agreed to bear the dissolution expenses. Actual dissolution expenses ₹ 6,500 were paid by Rishi, another partner, on behalf of Vivek.
(vi) Gaurav, a partner, was appointed to look after the work of dissolution for a commission of ₹ 12,500. He agreed to bear the dissolution expenses. Gaurav took over furniture of ₹ 12,500 as his commission. The furniture had already been transferred to realisation account.