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Accountancy · 2022 · 5 marks
Dissolution of Partnership FirmAccounting Treatment on Dissolution of a Partnership Firm5 markslong answer
CBSE 2022 · Region 2 · Set 1 · Q7
A and B are partners sharing profits and losses equally. On 31st March, 2021, they decided to dissolve their firm. On the date of dissolution, their…
A and B are partners sharing profits and losses equally. On 31st March, $\displaystyle 2021$, they decided to dissolve their firm. On the date of dissolution, their Balance Sheet was as under :
Balance Sheet of A and B as at 31st March, $\displaystyle 2021$
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| Creditors | $\displaystyle 3,00,000$ | Bank | $\displaystyle 3,00,000$ |
| A's Loan | $\displaystyle 60,000$ | Stock | $\displaystyle 2,40,000$ |
| Mrs. A's Loan | $\displaystyle 70,000$ | Furniture | $\displaystyle 2,00,000$ |
| Capitals : | Plant and Machinery | $\displaystyle 1,00,000$ | |
| A $\displaystyle 2,30,000$ | Profit and Loss A/c | $\displaystyle 50,000$ | |
| B $\displaystyle 2,30,000$ | $\displaystyle 4,60,000$ | ||
| $\displaystyle 8,90,000$ | $\displaystyle 8,90,000$ |
The assets were realised and liabilities were paid as under : (i) Creditors were paid at $\displaystyle 20$% less. (ii) Furniture was taken over by A for ₹ $\displaystyle 1,80,000$ and Plant and Machinery was sold for ₹ $\displaystyle 80$,000. (iii) B took over the stock at ₹ $\displaystyle 1,80$,000. (iv) A promised to pay Mrs. A's loan . (v) Realisation expenses of ₹ $\displaystyle 20,000$ were paid by B. Prepare Realisation Account.
Vidit, Vinay and Siya were partners in a firm. On 31st March, $\displaystyle 2021$, their Balance Sheet was as follows :
Balance Sheet of Vidit, Vinay and Siya as at 31st March, $\displaystyle 2021$
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| Creditors | $\displaystyle 72,000$ | Cash | $\displaystyle 28,000$ |
| Bank Loan | $\displaystyle 18,000$ | Stock | $\displaystyle 46,000$ |
| General Reserve | $\displaystyle 18,000$ | Debtors | $\displaystyle 34,000$ |
| Capitals : | Building | $\displaystyle 30,000$ | |
| Vidit $\displaystyle 48,000$ | Plant and Machinery | $\displaystyle 66,000$ | |
| Vinay $\displaystyle 16,000$ | |||
| Siya $\displaystyle 32,000$ | $\displaystyle 96,000$ | ||
| $\displaystyle 2,04,000$ | $\displaystyle 2,04,000$ |
On the above date, Vinay retired and it was agreed that : (i) The value of stock will be reduced by ₹ $\displaystyle 10$,000. (ii) Plant and Machinery will be valued at ₹ $\displaystyle 80$,000. (iii) An amount of ₹ $\displaystyle 4,500$ included in creditors is not likely to be claimed. (iv) Debtors to be valued at ₹ $\displaystyle 30$,000. (v) Amount due to Vinay will be transferred to Vin ay's Loan Account. Prepare Revaluation Account and Vinay's Capital Account .
Marking-scheme solution
Dr. Realization A/c Cr
Amount Particulars Amount
Particulars
(₹) (₹)
To Sundry Assets : By Sundry Liabilities
:
Stock $\displaystyle 2,40,000$
Creditors $\displaystyle 3,00,000$
Furniture $\displaystyle 2,00,000$
Mrs. A’s loan $\displaystyle 70,000$
Plant & Machinery $\displaystyle 1,00,000$ $\displaystyle 5,40,000$ $\displaystyle 3,70,000$
To Bank : By A’s Capital A/c
$\displaystyle 1,80,000$
-Creditors $\displaystyle 2,40,000$ -Furniture
To A’s Capital A/c : By Bank A/c :
-Mrs. A’s loan $\displaystyle 70,000$ -Plant and
$\displaystyle 80,000$
To B’s Capital A/c : Machinery
By B’s Capital A/c:
-Realization Expenses $\displaystyle 20,000$
-Stock $\displaystyle 1,80,000$
By Loss
Transferred to :
A’s Capital A/c
$\displaystyle 30,000$
B’s Capital A/c
$\displaystyle 30,000$
$\displaystyle 60,000$
$\displaystyle 8,70,000$ $\displaystyle 8,70,000$
Q. (b) Vidit, Vinay and Siya………
Ans.
Dr. Revaluation A/c Cr.
Particulars (₹) Particulars (₹)
To Stock A/c $\displaystyle 10,000$ By Plant A/c $\displaystyle 14,000$
To Debtors A/c $\displaystyle 4,000$ By Creditor $\displaystyle 4,500$
To Gain on Revaluation A/c
transferred to Partners’ Capital
Accounts:
Vidit $\displaystyle 1,500$
Vinay $\displaystyle 1,500$
Siya $\displaystyle 1,500$ $\displaystyle 4,500$
$\displaystyle 18,500$ $\displaystyle 18,500$
Dr. Vinay’s Capital A/c Cr.
Particulars (₹) Particulars (₹)
To Vinay’s Loan A/c $\displaystyle 23,500$ By Balance b/d $\displaystyle 16,000$
By Revaluation A/c $\displaystyle 1,500$
By General Reserve $\displaystyle 6,000$
$\displaystyle 23,500$ $\displaystyle 23,500$
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