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Wednesday, January 23, 2019

AHSEC/CBSE Accountancy Question Bank: Dissolution of Partnership Firm

Dissolution of Partnership for Class 12 AHSEC/CBSE/B.Com 1st Sem
Q.1. Ram and Shyam share the profits equally. They decided to dissolve their firm. Their liabilities were : Ram’s Capital Rs. 25,000; Shyam’s Capital Rs. 30,000; Creditors Rs. 12,500; Bills payable Rs.7,500; Assets of the firm realized Rs.1,00,000. Prepare a Realization Account.
Q.2. The following is the Balance Sheet of Anju and Manju sharing profits in the ratio of 3:2 as on December 31, 2003 :

Balance Sheet as at December 31, 2003
Liabilities
Amount
Assets
Amount
Creditors
Loan by Anju’s brother
Loan by Manju
General Reserve
Capitals :
Anju
Manju
Profit and Loss
19,000
 5,000
7,500
1,250

5,000
4,000
2,500
Plant and Machinery
Furniture and Fixtures
Investment
Stock
Debtors                                                 10,000
Less: provision                                          500
Bank
14,000
2,000
5,000
3,000

9,500
5,750

41,750

41,750
The firm was dissolved on March 31, 2003. As a result,
(a)    Anju took over investments at an agreed value of Rs. 4,000 and agreed to pay loan taken from her brother
(b)   Realization of assets is as follows : Stock Rs. 2,500, Debtors Rs. 9,250, Furniture and Fixture Rs. 2,250, Plant and Machinery Rs. 12,500
(c)    Expenses of realization were Rs. 300
(d)   Creditors allowed 2.5% discount in full settlement. Record necessary journal entries and close the books of the firm.
Q.3. Dinesh, Ramesh and Satish were partners in a firm sharing-profits in the ratio of 5:3:2. They agreed to dissolve their partnership firm on March 31, 2002. Dinesh was asked to realize the assets and pay off liabilities. He had to bear the realization expenses for which he was promised a lump sum amount of Rs. 2,000. Their financial position on that date was as follows :
Balance Sheet as at March 31, 2002
Liabilities
Amount
Assets
Amount
Creditors
Investment fluctuation fund
Capitals :
Dinesh
Ramesh
Suresh
27,500
9,000

75,000
30,000
16,000
Plant and Machinery
Investment
Stock
Debtors                                               14,200
Less: provision                                        900
Bank
Profit and losses account
60,000
30,000
11,000

13,300
11,200
32,000

1,57,500

1,57,500
Dinesh agreed to purchase investments at Rs. 25,000. Ramesh took over stock at Rs. 10,500 and Debtors at Rs. 11,800. Plant and Equipment was sold for Rs. 45,000. Unrecorded assets realized cash of Rs. 3,000. Actual realization expenses amounted to Rs. 1,800. Prepare necessary ledger accounts on the dissolution of firm.
Q.4. Lata, Geeta and Neeta were partners sharing profits in the ratio of 5:3:1. They decided to dissolve the partnership on March 31, 2001 and their balance sheet was as under.
Balance Sheet Lata, Geeta and Neeta as at March 31, 2001
Liabilities
Amount
Assets
Amount
Creditors
Bills Payable
Mortgage loan
General Reserve
Capitals :
Lata
Geeta
Neeta
16,600
3,400
15,000
4,500

22,000
18,000
10,000
Plant and Machinery
Investment
Stock
Debtors                                                   25,000
Less: provision                                         5,000
Bank
Deferred Revenue Expenditure
Suspense
30,000
10,000
10,000

20,000
9,500
5,000
5,000

89,500

89,500
There was a typewriter written off which realised Rs. 500. They had a joint life policy of Rs. 20,000 which was surrendered for Rs. 5,000. Goodwill was sold for Rs. 5,000. Other assets realized – stock Rs. 6,700; debtors 50%; plant and machinery 10% less than its book value. Creditors were paid Rs. 16,000. But an outstanding bill of Rs. 400 for repairs was to be paid off. Expenses on realization amounted to Rs. 620. Give journal entries to record the above transactions and also prepare necessary ledger accounts.
Q.5. Following is the Balance Sheet of Raman and Ramesh on June 30, 2002.
Liabilities
Amount
Assets
Amount
Creditors
Bills Payable
Bank overdraft
Mrs. Raman’s loan
Ramesh’s loan
Investment fluctuation fund
Employees provident fund
Ramesh’s loan
General Reserve
Raman’s Capital
Ramesh’ Capital
20,000
20,000
10,000
5,000
5,000
2,800
1,200
10,000
2,000
20,000
20,000
Goodwill
Building
Plant and fitting
Investment
Stock
Debtors                                                  17,000
Less: provision                                        2,000
Bills Receivable
Deferred Revenue Expenditure
Suspense
10,000
25,000
25,000
15,300
8,700

15,000
10,000
2,000
5,000

1,16,000

89,500
The firm was dissolved on June 30, 2002 and following was the position:
a)      Raman agreed to pay off his wife’s loan.
b)      Debtors realized Rs. 12,000.
c)       Ramesh’s loan transferred to his capital account.
d)      Ramesh took away all the investments at Rs. 12,000.
e)      Other assets realized as follows : Plant and Fittings 20,000, Building 50,000, Goodwill 6,000
f)       Sundry creditors and Bills payable were settled at 5% discount.
g)      Raman accepted stock at Rs 8,000 and Ramesh took over bills receivable at 20% discount.
h)      Realization expenses amounted to Rs. 2,000.
Record journal entries and also prepare various ledger accounts.
Q.6. R, M and H were in partnership sharing profits and losses in the ratio of 8: 5: 3 respectively. The firm’s balance sheet as on 31st March, 2015 was as under:
Balance Sheet
Liabilities
(Rs.)
Assets
(Rs.)
Capitals :
    R          =      5,000/-
    M         =     2,000/-
    H          =     1,000/-
Sundry Creditors
Bank Loan



8,000
2,953
5,500
Current Account :
R        =       2,195/-
M       =       1,733/-
H        =       1,520/-
Machinery
Stock
Sundry Debtors
Cash



5,448
1,050
6,059
3,572
324

TOTAL
16,453
TOTAL
16,453
It was resolved to dissolve the partnership as on that date. The assets were realised as follows:
Machinery
Stock
Sundry Debtors
600/-
5,230/-
3,555/-
Pass Journal Entries and necessary ledger Accounts.
Q.7. Kumar and Gaurav are partners sharing profit and losses as three-fourth and one-fourth. They agreed to dissolve their firm. On the date of dissolution, they have following Balance sheet:             (8)   2012
Liabilities
Amount
Assets
Amount
Capital Account:
Kumar 40,000
Gaurav 35,000
Creditor
Loan From Mrs.Gaurav


75,000
16,000
13,000
Land and Building
Plant and machinery
Sundry Debtors 22,000
Less reserve          2000
Bills receivable
Cash in hand     
50,000
18,000

20,000
7,500
8,500
1,04,000
1,04,000


The Assets Realised as follows:
(i) Land and Building Rs.48, 000
(ii) Sundry Debtors Rs.18, 000
(iii) Goodwill Rs.16, 500
Kumar took over plant and machinery at 5% more than the book value. Gaurav agreed to discharge his wife’s loan. Creditors are paid Rs.12, 000 in full settlement of their claim and expenses on realisation amounted to Rs.700. You are required to show Realisation Account, Cash Account and Capital Accounts of the Partners on dissolution.
Q.8. Amal and Bimal are two partners in a firm. They share profits in the ratio of 3:2. Following is their Balance Sheet as on 31.12.2012 on which date they dissolved their partnership firm:  2014
Balance Sheet
Liabilities
Amount
Assets
Amount
Capital:
Amal  - 20000
Bimal – 15000
Reserve Fund
Creditors


35000
5000
20000
Fixed Assets
Stock
Debtors
Cash
Profit and Loss Account
30000
10000
15000
3000
2000

60,000

60,000
Assets are realised as: Fixed Assets Rs.28000, Stock Rs.8000 and Debtors Rs.13000. Creditors were paid at a discount of 10%. Expenses of realisation were Rs.1500. Pass Journal Entries in the books of the firm.
Q.9. A and B are partners sharing profits in the ratio of 3:2. Their Balance Sheet as on 31.03.14 was as follows:        2015
Balance Sheet
Liabilities
Rs.
Assets
Rs.
Capital :
    A = 10,000/-
    B =   2,000/-
General Reserve
Sundry Creditors


12,000/-
2,500/-
7,500/-
Sundry Assets
Profit & Loss A/c
17,000/-
5,000/-

22,000/-

22,000/-
The firm is dissolved on the above date. Assets are realised at Rs. 13,500/-. Dissolution expenses came to Rs. 250/-. Give journal entries to close the books of the firm.                                                   
Q.10. R, M and H were in partnership sharing profits and losses in the ratio of 8: 5: 3 respectively. The firm’s balance sheet as on 31st March, 2015 was as under:                   2016
Balance Sheet
Liabilities
(Rs.)
Assets
(Rs.)
Capitals :
    R          =      5,000/-
    M         =     2,000/-
    H          =     1,000/-
Sundry Creditors
Bank Loan



8,000
2,953
5,500
Current Account :
R        =       2,195/-
M       =       1,733/-
H        =       1,520/-
Machinery
Stock
Sundry Debtors
Cash



5,448
1,050
6,059
3,572
324
TOTAL
16,453
TOTAL
16,453
It was resolved to dissolve the partnership as on that date. The assets were realised as follows:
Machinery
Stock
Sundry Debtors
600/-
5,230/-
3,555/-
Prepare Realisation Account.
Q.11. Akash and Bikash are partners sharing profits in the ratio of 3:2. Their Balance Sheet as on 31/03/2016 was as follows:              2017
Balance Sheet
Liabilities
(Rs.)
Assets
(Rs.)
Capital:
      Akash =   12,000/-
      Bikash =    8,000/-

General Reserve
Sundry Creditors


20,000

10,000
10,000
Sundry Assets
40,000

40,000

40,000
The firm is dissolved on the above date. Assets are realized at Rs. 60,000/- Dissolution expenses came to Rs. 2,000/- 5. Pass journal entries.
Q.12. SONU and ASHU were partners sharing profits in the ratio of 3 : 1. Their Balance Sheet as on 31st March, 2017 was as follows:                 2018
Balance Sheet
Liabilities
(Rs.)
Assets
(Rs.)
Creditors
Loan
Capital:
SONU:                            50,000/-
ASHU:                            50,000/-
10,000
20,000


1,00,000
Cash at Bank
Sundry Assets
Profit and Loss Account
20,000
70,000
40,000

1,30,000

1,30,000
The firm was dissolved on the above date. The assets were realised at Rs. 50,000/-. Creditors were paid at a discount of 20%. SONU agreed to pay off the Loan. Realisation expenses were Rs. 2,000/-. Prepare Realisation Account, Bank Account and Partners Capital Account.                                                   
Q.13. A and B are partners sharing profits equally, Balance Sheet on September 2018 was as follows:      5           2019
Balance Sheet
Liabilities
(Rs.)
Assets
(Rs.)
Sundry Creditors
Bills Payable
Reserve Fund 
Capital:
A                         20,000/-
B                         20,000/-
11,200
1,800
6,000


40,000
Sundry Assets
59,000

59,000

59,000
The firm is dissolved on the above date. Assets are realized at Rs. 49,600. Creditors allowed a discount of 2% and Dissolution Expenses came to Rs. 544. Give Journal Entries to close the books of the firm.
Q.14. Dipali and Rajshri were partners in a firm sharing profits and losses in the ratio of 3 : 2. They decided to dissolve their firm on 31st December, 2019, when their Balance Sheet was as under:                    5                 2020
Balance Sheet
Liabilities
Rs.
Assets
Rs.
Capital:
Dipali                       18,400
Rajshri                     10,600
Sundry Creditors


29,000
2,000
Land
Investments
Sundry Debtors
Stock
Cash at Bank

16,000
4,000
2,000
3,000
6,000

31,000

31,000
Investments are sold at Rs. 3,800. Other assets realised as follows:
a)         Land Rs. 28,000, Sundry Debtors Rs. 1,800, Stock Rs. 2,800.
b)         Creditors agreed to accept 5% less. Expenses of realisation amounted to Rs. 400.
Prepare Realisation A/c, Partners’ Capital A/c and Bank A/c.

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