Advertisement

X and Y are equal partners. The firm was dissolved on 31st March, 2012.

The following is their Balance Sheet as on 31st March, 2012.

Liabilities
Rs.
Rs.
Assets
Rs.
Rs.
X’s Capital
Y’s Capital
Reserve Fund
X’s Loan
Creditors
40000
30000
8000
2000
15000
Building
Machinery
Furniture
Debtors
Less: R.D.D.
Stock
Investments
Commission Receivable
Bank



8800
- 800
30000
10000
12000

8000
20000
4000
1000
10000
95000
95000
The firm was dissolved on 31st March, 2012. 
(i) The Assets realised as follows:
Stock Rs. 19,000, Debtors Rs. 7,500, Machinery Rs. 11,000, Building Rs. 14,000
ii. Y took over the investments Rs. 5000 and Furniture at Book Value.
iii. X agreed to accept Rs. 1500 in full settlement of his Loan Account.
iv. Dissolution expenses amounted to Rs. 2000.
v. Commission Receivable could not be recovered.
Prepare Realisation Account, X’s Loan Account, Capital Accounts and Bank Account.

Solution:
Realisation Account


Particulars
Rs.
Rs.
Particulars
Rs.
Rs
To Sundry Assets
By Sundry Liabilities
Building
30000
Creditors
15000
Machinery
10000
By R.D.D. A/c
800
Furniture
12000
By Bank A/c
Debtors
8800
Stock
19000
Stock
20000
Debtors
7500
Investments
4000
Machinery
11000
Commission Receivable
1000
85800
Building
14000
51500
To Bank A/c
2000
BY Y’s Capital A/c
(Dissolution Expenses)
Investments
5000
To Bank A/c
Furniture
12000
17000
Creditors
15000
By X’s Loan A/c
500
By Loss on Realisation A/C
X
9000
Y
9000
18000
102800
102800


Partners Capital Account
Particulars
X
Y
Particulars
X
Y
To Realisation A/c
17000
By Balance b/d
40000
30000
To Realisation A/c
(loss)
9000
9000
By Reserve Fund (1:1)
4000
4000
To Bank A/c
35000
8000
44000
34000
44000
34000


X’s Loan Account
Particulars
Rs.
Rs.
Particulars
Rs.
Rs
To Bank A/c
1500
By Balance b/d
2000
To Realisation A/c 
500
2000
2000



Bank Account

Particulars
Rs.
Rs.
Particulars
Rs.
Rs
To Balance b/d
10000
By Realisation A/c
2000
To Realisation A/c
51500
By Realisation A/c
15000
By X’s Loan A/c
1500
By X’s Capital A/c
35000
By Y’s Capital A/c
8000
61500
61500