CBSE 2026 · Region 3 · Set 2 · Q23

Sophia and Lalit were partners in a firm sharing profits and losses equally. Their firm was dissolved on 31st March, 2025. After transferring sundry assets (other than cash in hand and cash at bank) and the third party liabilities to the Realisation Account, the following transactions took place : (i) The firm had stock of the book value of ₹ $\displaystyle 80$,000. $\displaystyle 50$% of the stock was taken over by Sophia at $\displaystyle 10$% less than its book value and the remaining stock was sold at a gain of $\displaystyle 15$%. (ii) There was an unrecorded investment which was sold for ₹ $\displaystyle 25$,000. (iii) There were debtors of ₹ $\displaystyle 1,20$,000. Debtors realised $\displaystyle 90$% only and $\displaystyle 5,000$ were recovered for bad debts written off last year. (iv) Sophia had given a loan to the firm of ₹ $\displaystyle 52$,000. She was paid ₹ $\displaystyle 41,000$ in full settlement of her claim. (v) Creditors of ₹ $\displaystyle 60,000$ were paid at a discount of $\displaystyle 5$%. (vi) Expenses of realisation amounting to ₹ $\displaystyle 7,000$ were paid by Lalit. Pass necessary journal entries for the above transactions in the books of the firm.