Question 25. P, Q&A were partners in a company that shared profits and losses at a ratio of 5:3:2. They agreed to dissolve their partnership on March 31, 2018. P was responsible for realizing assets and settling liabilities. He paid ₹1,000 as a commission for his services. The company`s financial situation was as follows: P took over investments for ₹ 12,500. Actions and debtors realized ₹ 11,500. The plants and machinery were sold to Q for ₹22,500 for cash. Realized unrecognized assets ₹ 1,500. The construction costs paid amounted to ₹ 900. Prepare the general ledger accounts necessary to close the company`s books.
Solution: Question 38. Krishna and Arjun are partners in a company. They share profits at a ratio of 4:1. They decided to merge the company on September 31. March 2018, when its balance sheet stood as follows: The achievement shows the following results: (a) Goodwill was sold for ₹ 1,000. (b) the debtors have been realized at a book value of less than 10 %. c) Trademarks were made for ₹ 800. d) Machinery and commercial inventory were acquired by Krishna for ₹14,400 and ₹3,600 respectively. e) An unrecognized asset estimated at ₹ 500 was sold for ₹ 200. f) The creditors of the property were paid with a discount of ₹ 80. The cost of realization was ₹ 800. Prepare the realization account, the partner`s capital accounts and the bank account.
Solution: Question 11. Rohit, Kunal and Sarthak are partners in a law firm. They decided to dissolve their company. Pass the required journal entries for the following after various assets (except cash and bank) and civil liability have been transferred to the fulfillment account: (a) Kunal has agreed to repay his wife`s loan in the amount of ₹6,000. b) The total number of creditors of the company was ₹ 40,000. Creditors worth ₹10,000 received a piece of furniture that cost ₹8,000 in full and final settlement. The other creditors granted a 10% discount. (c) Rohit had granted the company a loan of ₹70,000, which was duly disbursed. d) A machine that was not in the books was taken over by Kunal for ₹ 3,000, while its expected value was ₹ 5,000.
e) The company had a debit balance of ₹15,000 in the income statement at the time of dissolution. f) Sarthak paid the costs of setting up ₹ 16,000 of its private funds, which were to receive a remuneration of ₹ 15,000 for the completion of the dissolution process and was responsible for bearing all the costs of realization. Solution: Question 12. The carrying amount of the assets (excluding cash and bank) transferred to the realizable account is ₹ 1,00,000. 50% of the assets are taken over by an Atul partner at a discount of 20%; 40% of the remaining assets are sold with a profit of 30% at cost 5% of the balance are obsolete nothing realized and the remaining assets are handed over to a creditor in full settlement of his claim. You are required to enter the log entries for the realization of the assets. Solution: Question 4. Enter the required journal entries in the following cases: (a) Creditors worth ₹ 85,000 accepted ₹ 40,000 in cash and investment worth ₹ 43,000, in full settlement of their claim. (b) The creditors were ₹16,000. They accepted machines worth ₹18,000 to settle their claim. (c) The creditors were ₹90,000.
They accepted a building worth ₹1,20,000 and paid the company ₹30,000 in cash. Solution: Question 9. Transmit the journal entries necessary to record the following unrecorded assets and liabilities in the books of Paras and Priya: (a) There was an old piece of furniture in the company that had been fully written off the books. This was sold for ₹3,000. b) Ashish, a former client whose account was written off as poor for ₹1,000 the previous year, paid 60% of the amount. (c) Paras has agreed to assume the Goodwill of the Company (not recorded in the Company`s books) at a value of ₹ 30,000. (d) There was an old typewriter that had been copied entirely from the books. It has been estimated to achieve ₹ 400.
It was taken by Priya at an estimated price of less than 25%. (e) 100 shares of ₹10 each were purchased from Star Limited for ₹2,000, which had been fully written off the books. These shares are each valued at ₹6 and distributed among shareholders in their profit-sharing ratio. Solution: Question 2. Pass the journal entries for the following: (a) The realization costs of ₹ 15,000 should be borne by Rahul, a partner, but have been paid by the company. (b) Ramesh, a partner, received a remuneration of ₹ 25,000 and had to bear all costs. (c) Anuj, a partner, received a remuneration of ₹ 20,000 and had to bear all costs. The company paid an expense of ₹5,000. Solution: Question 17. Ramesh and Umesh were partners in a company that shared profits in proportion to their capital.
As at March 31, 2013, its balance sheet was as follows: On the above-mentioned day, the company was dissolved. (a) Ramesh acquired 50% of the shares at a price ₹10,000 below book value. The remaining shares were sold with a loss of ₹15,000. The debtors were made at a discount of 5%. b) The furniture was sold by Umesh for ₹ 50,000 and the machines for ₹ 4,50,000. (c) Creditors have been paid in full. d) There was an unregistered invoice for repairs of ₹ 1,60,000, which was paid at ₹ 1,40,000. Prepare the completion account. Solution: Question 36.
You will find below the balance sheet of Vishnu, Sanjiv and Sudhir at 31. March 2018: The earnings sharing ratio of partners is 5: 3: 2. At that time, the partners decided to dissolve the firm. The assets were realized as follows: The receivables on bills of exchange were realized with a discount of 5%. All debtors were good. Portfolio realized ₹ 22,000. Land and buildings reached 40% more than the book value. The furniture was sold for ₹8,000 per auction and the auction commission was ₹500. The computers were taken by Vishnu for a greed rating of ₹3,000. The investments were sold on the open market for ₹45,000, for which a commission of ₹600 was paid to the broker. The invoices payable have been paid in full.
However, creditors agreed to accept 10% less. All other liabilities were repaid at book value. The company laid off its employees three months before the company was dissolved and the company had to pay ₹20,000 as compensation. Preparation of the realization account, the partner capital accounts and the cash account. Solution: Question 19. Achal and Vichal were partners in a company that shared profits at a ratio of 3:5. As at 31 March 2018, its balance sheet was as follows: The company was dissolved on 1 April 2018 and the assets and liabilities were settled as follows: (a) Land and building b realized ₹ 4,30,000. (b) Debtors realized last year ₹ 2,25,000 (with interest) and ₹ 1,000 were recovered for bad debts. . . .