Practical Problem 02
Practical problem | Q 2 | Page 244
Leela, Manda and Kunda are partners in the firm ‘Janki Stores’ sharing Profits and Losses in the ratio of 3:2:1 respectively. | |||
On 31st March 2018 they decided to dissolve the firm when their Balance Sheet was as under | |||
| |||
Balance Sheets as on 31st March 2018. | |||
Liabilities | AMOUNT | ASSET | AMOUNT |
Creditors | 28,800 | Building | 1,02,000 |
Bills Payable | 21,600 | Machinery | 73,000 |
Capital A/c’s | Motor Car | 1,67,600 | |
Leela | 2,27,160 | Goodwill | 45,600 |
Manda | 1,44,000 | Investment | 62,400 |
Kunda | 1,08,000 | Debtors | 30,600 |
Stock | 45,000 | ||
Bank | 3,360 | ||
5,29,560 | 5,29,560 | ||
Leela agreed to take over the Building at Rs 1,23,600. | |||
Manda took over Goodwill, Stock and Debtors at Book values and agreed to pay | |||
Creditors and Bills payable. Motor Car and Machinery realised Rs 1,51,080 and | |||
Rs 31,680 respectively. Investments were taken by Kunda at an agreed value of | |||
Rs ` 55,440. Realisation expenses amounted to Rs 6,800. | |||
Pass necessary entries in the books of ‘Janki Stores.’ | |||
SOLUTION :
Journal Entries | |||
Date | Particular | Amount | Amount |
1 | Realisation A/c ………………………………………………………………………………………..……………..……………..……………...…………………………..Dr | 5,26,200 | |
To Building A/c | 1,02,000 | ||
To Machinery | 73,000 | ||
To Motor Car | 1,67,600 | ||
To Goodwill | 45,600 | ||
To Investment | 62,400 | ||
To Debtors | 30,600 | ||
To Stock | 45,000 | ||
(Being Asset transfer to realisation A/c) | |||
2 | Creditors ………………………………………………………………………………………..……………..……………..……………………………………...…………………………..Dr | 28,800 | |
Bills Payable………………………………………………………………………………………..……………..……………..……………...…………………………………………….Dr | 21,600 | ||
To Realisation A/c | 50,400 | ||
(Being Sundry Liability transfer to Realisation A/c) | |||
3 | Leela’s Capital A/c ………………………………………………………………………………………..……………..……………..……………...…………………………..Dr | 1,23,600 | |
To Realisation A/c | 1,23,600 | ||
(Being Building taken over by Leela) | |||
4 | Manda’s Capital A/c ………………………………………………………………………………………..……………..……………..……………...…………………………..Dr | 1,21,200 | |
To Realisation A/c | 1,21,200 | ||
(Being Goodwill, Stock and Debtors taken over by Manda) | |||
5 | Realisation A/c ………………………………………………………………………………………..……………..……………………..…..……………...…………………………..Dr | 50,400 | |
To Manda’s Capital A/c | 50,400 | ||
(Being Creditor’s and Bill Payable takenover by Manda) | |||
6 | Cash A/c………………………………………………………………………………………..……………..……………..…………………………………..…...…………………………..Dr | 1,82,760 | |
To Realisation A/c | 1,82,760 | ||
(Being Motor Car & Machinery Sold) | |||
7 | Kunda Capital A/c ………………………………………………………………………………………..……………..……………..……………..…...…………………………..Dr | 55,440 | |
To Realisation A/c | 55,440 | ||
(Being Investment taken over by Kunda) | |||
8 | Realisation A/c ………………………………………………………………………………………..……………………….……………..……………...…………………………..Dr | 6,800 | |
To Cash A/c | 6,800 | ||
(Being Realisation Expenses Paid) | |||
9 | Leela Capital A/c…………………………………………………………………………………………..……………..……………..……………...…………………………..Dr | 25,000 | |
Manda Capital A/c …………………………………………………………………………………………….….…..……………..……………...…………………………..Dr | 16,667 | ||
Kunda Capital A/c ………………………………………………………………………………………..……………..……………..……………...…………………………..Dr | 8,333 | ||
To Realisation A/c | 50,000 | ||
(Being Realisation loss on realisation transfer to partners) | |||
10 | Leela Cpaital A/c……………………………………………………………………………………………..……………..……………..……………...…………………………..Dr | 78560 | |
Manda Capital A/c ……………………………………………………………………………………….……….…..……………..……………...…………………………..Dr | 56,533 | ||
Kunda Capital A/c ………………………………………………………………………………………..……………..……………..……………...…………………………..Dr | 44,227 | ||
To Cash A/c | 1,79,320 | ||
(Bing Cash Paid to Partners on Dissolution) | |||
Working:
Dr Realisation A/c Cr | |||||
Particulars | Amount | Amount | Particulars | Amount | Amount |
To Sundry Assets A/c | By Sundry Liabilities A/c | ||||
Building | 1,02,000 | Creditors | 28,800 | ||
Machinery | 73,000 | Bills Payable | 21,600 | 50,400 | |
Motor car | 1,67,600 | By Bank A/c | |||
Goodwill | 45,600 | Motor Car | 1,51,080 | ||
Investments | 62,400 | Machinery | 31,680 | 1,82,760 | |
Debtors | 30,600 | By Leela’s Capital A/c | 1,23,600 | ||
Stock | 45,000 | 5,26,200 | Building | ||
To Bank A/c | By Manda’s Capital A/c | ||||
Realisation Expense | 6,800 | Goodwill | 45,600 | ||
To Manda’s Capital A/c | Stock | 45,000 | |||
Creditors | 28,800 | Debtors | 30,600 | 1,21,200 | |
Bills Payable | 21,600 | 50,400 | By Kunda’s Capital A/c | 55,440 | |
Investments | |||||
By Partners’ Capital A/c (Loss on realisation transferred) | |||||
Leela | 25,000 | ||||
Manda | 16,667 | ||||
Kunda | 8,333 | 50,000 | |||
583400 | 583400 | ||||