Lalit and Madan were partners in a firm sharing profits and losses in the ratio of $\displaystyle 7$ : 3. On 31st March, $\displaystyle 2024$ their firm was dissolved. After transferring sundry assets (other than cash) and third party liabilities to Realisation Account, the following transactions took place : (i) The firm had stock of ₹ $\displaystyle 2,00$,000. $\displaystyle 40$% of this stock was taken over by a creditor of ₹ $\displaystyle 1,00,000$ in full settlement of his claim. The remaining stock was sold at a loss of $\displaystyle 10$%. (ii) The remaining creditors were paid $\displaystyle 2,10$,000. (iii) Plant and Machinery of ₹ $\displaystyle 5,00,000$ were accepted by Mrs. Madan against the settlement of her loan of $\displaystyle 5,40$,000. (iv) Debtors of ₹ $\displaystyle 3,50,000$ were sold to a debt collection agency who charged a commission of $\displaystyle 25$,000. (v) Investments of $\displaystyle 1,00,000$ were taken over by the partners in their profit sharing ratio. (vi) Expenses of dissolution were $\displaystyle 8$,000. Pass necessary journal entries for the above transactions in the books of the firm.

In the books of Lalit and Madan Journal Date Particulars L.F. Dr. Cr. Amount(₹) Amount(₹) $\displaystyle 2024$ (i) Cash/Bank A/c Dr. $\displaystyle 1,08,000$ March $\displaystyle 31$ To Realisation A/c $\displaystyle 1,08,000$ (Part of stock sold at loss of $\displaystyle 10$%) ,, (ii) Realisation A/c Dr. $\displaystyle 2,10,000$ To Cash/Bank A/c $\displaystyle 2,10,000$ (Creditors paid) ,, (iii) No entry ,, (iv) Cash/Bank A/c Dr. $\displaystyle 3,25,000$ To Realisation A/c $\displaystyle 3,25,000$ (Cash recovered by debt collection agency after debiting their commission) ,, (v) Lalit’s capital A/c Dr. $\displaystyle 70,000$ Madan’s capital A/c Dr. $\displaystyle 30,000$ To Realisation A/c $\displaystyle 1,00,000$ (Investments taken over by partners in profit sharing ratio) ,, (vi) Realisation A/c Dr. $\displaystyle 8,000$ To Cash/Bank A/c $\displaystyle 8,000$ (Realisation expenses paid)