(i) Anita and Binita are partners in a firm.
Anita had taken a loan of ₹15,000 from
the firm. How will Anita’s loan be closed in the event of dissolution of the firm?
(a) By crediting it to Anita’s Capital Account.
(b) By debiting it to Anita’s Capital Account.
(c) By crediting it to Realisation Account.
(d) By debiting it to Cash Account.
(ii) A company issued 5,000 10% Debentures of ₹100 each at a discount of 5%. To
write off the capital loss, it has to use its profits in a certain order.
Chose the correct order in which the profits are used by the company to write off
the capital loss:
A statement of profit and loss
B Capital Reserve
C Securities Premium
(a) A,B,C
(b) B,A,C
(c) C,B,A
(d) A,C,B
(iii) X, Y and Z share profits and losses in the ratio of 5:3:2. Y retired and X and Z
decided to share future profits and losses in the ratio of 3:5. At the time of
retirement of Z, stock (Book value ₹1,25,000) is to be reduced by 40% and
furniture (Book value ₹75,000) is to be reduced to 40%.
Find the net decrease in value of assets.
(iv) Parul, Payal and Priyanka are partners. They decided to dissolve the firm. Pass the
necessary journal entries for the following after the various assets (other than cash
and bank) and outside liabilities have been transferred to realization account.
There were total debtors of ₹76,000. A provision for bad and doubtful debts also
stood in the books at ₹6,000. ₹12,000 debtors proved bad and rest paid the
amount.
Parul agreed to pay off her husband’s loan of ₹7,000 at a discount of 5%.
A machine which is not recorded in the books was taken over by Payal at ₹3,000
whereas its expected value was ₹5,000. [3]
(v) Akhil and Bhaskar, who were partners sharing profits and losses in the ratio of 4/7
and 3/7 respectively, decided to dissolve the partnership firm on 31st March,
2021. On the date of the dissolution, Akhil's capital was ₹1,25,030 and Bhaskar's
capital was ₹2,070. The creditors amounted to ₹23,150 and cash ₹4,520. The
remaining assets realised ₹1,24,910 and the expenses of dissolution were ₹1,860.
Both Akhil and Bhaskar were solvent.
Prepare Balance Sheet of the firm as at the date of dissolution and Realisation account. [3]
(vi) Lokesh, Mansoor and Nihal are partners sharing profits and losses in the ratio of
3:1:2 On 31st March, 2023, Mansoor retired and balance in his capital account
after making adjustment of reserves and profit on revaluation was 70,000. Lokesh
and Nihal paid him ₹ 84,000 in full settlement of his claim. To settle his account,
a computer of book value of ₹84,000 was given to Mansoor.
You are required to pass the necessary Journal entries in the books of the firm.
(a) Harish, Paresh and Mahesh were three partners sharing profits and losses in the ratio
of 5:4:1. Paresh retired on 31st March, 2017. His capital as on 1st April, 2016, was
₹80,000. During the year 2016-17, he made drawings of ₹5,000. He was to be
charged interest on drawings of ₹100. The Partnership Deed provides that on the
retirement of a partner, he will be entitled to:
(i) His share of capital.
(ii) Interest on capital @ 10% per annum.
(iii) His share of profit in the year of retirement.
(iv) His share of goodwill of the firm.
(v) His share in the profit/loss on revaluation of assets and liabilities.
Additional Information:
1. Paresh's share in the profits of the firm for the year 2016-17 was ₹20,000.
2. Goodwill of the firm was valued at ₹24,000.
3. The firm suffered a loss of ₹12,000 on the revaluation of assets and liabilities.
4. It was decided to transfer the amount due to Paresh to his loan account bearing
interest @6% per annum. The loan was to be repaid in two equal annual
instalments, the first instalment to be paid on 31st March, 2018.
You are required to prepare:
(1) Paresh's Capital Account.
(2) Paresh's Loan Account till it is finally closed. [6]
(b) Lisa, Monika and Nisha are partners in a firm. Monika retires and her claim including
her capital and share of goodwill is ₹3,00,000. There was unrecorded machinery with
estimated value of ₹15,000, half of which was given in settlement of an unrecorded
liability of ₹15,000 out of ₹30,000 and remaining half was given to Monika at a
discount of 10% in part settlement of her claim. Balance of Monika's claim was paid
by cheque.
Pass the necessary Journal entries to record the above adjustments.
a) Pass Journal entries in the following cases:
(i) Steve Ltd issued 4,000, 12% Debentures of 100 each at par redeemable at 10%
premium.
(ii) Mark Ltd issued 4,000,12% Debentures of 100 each at a discount of 5% and
redeemable at 5% premium.
(iii) Sam Ltd, issued 4,000, 12% Debentures of 100 each at a premium of 10%
redeemable at 110%. [6]
Question 9
Susan, Geeta and Rashi are partners sharing profits and losses in the ratio of 5:3:2 Their
Balance Sheet as at 31st March, 2017, is as under: [10]
BALANCE SHEET OF SUSAN, GEETA AND RASHI as at 31st March, 2017
Liabilities ₹ Assets ₹
Sundry liabilities 50,000 Cash at bank 70,000
Workmen Compensation 25,000 Debtors
reserve 65,000
5,000 60,000
Employee provident fund Less: provision for
55,000 (5,000)
Bank loan a/c
doubtful debts 50,000
Capital a/c
Goodwill 1,00,000
Susan 2,20,000
Furniture 3,80,000
Geeta 1,70,000
5,25,000 Building
Rashi 1,35,000
6,60,000 6,60,000
The partners decided to dissolve their partnership on 31st March, 2017.
The following transactions took place at the time of dissolution:
(a) Realisation expenses of ₹2,000 were paid by Susan on behalf of the firm.
(b) Geeta took over the goodwill for her own business at ₹40,000.
(c) Building was taken over by Rashi at ₹3,00,000.
(d) Only 80% of the debtors paid their dues.
(e) Furniture was sold for ₹97,000.
(f) Bank Loan was settled along with interest of ₹5,000.
You are required to prepare the Realisation Account.
