Practical Problem 01

Practical problem | Q 1 | Page 244

Ganesh and Kartik are partners sharing Profits and Losses equally. They decided to dissolve the firm on 31st March 2018.
Their Balance Sheets was as under :
Balance Sheets as on 31st March 2018.
Liabilities	AMOUNT	ASSET	AMOUNT
Creditors	18,400	Building	88,000
Bills Payable	5,600	Furniture	12,000
Reserve Fund	20,000	Debtors	32,000
Capital A/c :		Stock	24,000
Ganesh	40,000	Bills Receivable	4,000
Kartik	80,000	Cash	4,000
	1,64,000		1,64,000
Assets were realised as under :
Building ` 82,000, Debtors ` 22,000, Stock ` 20,000. Bills Receivable ` 3,200 and Ganesh
agreed to take over Furniture for ` 10,000. Realisation Expenses amounted to ` 2,000.
Show Realisation A/c, Partners’ Capital A/c and Cash A/c.

SOLUTION :

IN THE BOOKS OF FIRM
Dr Realisation A/c Cr
Particular	Amt	Amt	Particular	Amt	Amt
To Sundry Asset			By Sundry Liabilities
Building	88,000		Creditors	18,400
Furniture	12,000		Bills Payable	5,600	24,000
Debtors	32,000
Stock	24,000		By Cash/Bank A/c
Bills Receivable	4,000	1,60,000	Building	82,000
			Debtors	22,000
To Cash/Bank A/c			Stock	20,000
Realisation Expenses	2,000		Bills Receivable	3,200	1,27,200
creditor	18,400		By Ganesh Capital A/c		10,000
Bills Payable	5,600	26,000	Furniture
			By Partners Capital A/c
			(Loss on Realisation)
			Ganesh Capital A/c	12,400
			Kartik Capital A/c	12,400	24,800
		1,86,000			1,86,000

Dr Partner’s Capital A/c Cr
Particular	Ganesh	Kartik	Particular	Ganesh	Kartik
To Realisation A/c	10,000		By Balance b/d	40,000	80,000
To Realisation A/c	12,400	12,400	By Reserve Fund	10,000	10,000
(Loss on realisation)
To Cash/Bank A/c	27,600	77,600
	50,000	90,000		50,000	90,000

Dr Cash/Bank A/c Cr
Particular	Amount	Amount	Particular	Amount	Amount
To bal b/d		4,000	By Realisation A/c		26,000
To Realisation A/c		1,27,200	By Ganesh Capital A/c		27,600
			By Kartik Capital A/c		77,600
		1,31,200			1,31,200