Advertisement suspense account appeared on the asset side of the Balance sheet amounting Rs 28000 Creditors of Rs 40,000 agreed to take over the stock of Rs 30,000 at a discount of 10% and the balance in cash. B agreed to take over Investments of Rs 5000 at Rs 4900 Loan of Rs 15000 advanced by A to the firm was paid off. Bank loan of Rs 12000 was paid off. JOURNAL SN Particulars LF Debit(Rs) Credit(Rs) a) Realisation account –Dr 4000 A’s Capital account 4000 (Being commission given to A) b) A’s Capital account –Dr 14000 B’s Capital account –Dr 14000 Advertisement Suspense account 28000 (Being Advertisement suspense written off) c) Realisation account –Dr 13000 Cash account 13000 (Being creditors paid off) d) B’s Capital account –Dr 4900 Realisation account 4900 (Being asset taken over by the partner) e) A’s Loan account –Dr 15000 Cash account 15000 (Being partners loan paid off) f) Realisation account -- Dr 12000 Cash account 12000 (Being Bank loan paid off) X and Y are partners in the firm who decided to dissolve the firm. Assets and Liabilities are transferred to Realisation account. Pass necessary journal entries— Creditors were Rs 1,00,000. They accepted Building valued Rs 1,40,000 and paid cash to the firm Rs 40,000 Aman, an old customer whose account of Rs 1000 was written off as bad in the previous year paid 40% of the amount. There were 300 shares of Rs 10 each in ABC Ltd which were acquired for Rs 2000 were now valued at Rs 6 each. These were taken over by the partners in the profit sharing ratio. Profit on Realisation Rs 42000 was divided among the partners. Land and Building (Book value Rs 1, 60,000) was sold for Rs 3,00,000 through a broker who charged 2% commission on the deal. Plant and machinery (Book value Rs 60,000) was handed over to the creditor in full settlement of his claim.
Advertisement suspense account appeared on the asset side of the Balance sheet amounting Rs 28000 Creditors of Rs 40,000 agreed to take over the stock of Rs 30,000 at a discount of 10% and the balance in cash. B agreed to take over Investments of Rs 5000 at Rs 4900 Loan of Rs 15000 advanced by A to the firm was paid off. Bank loan of Rs 12000 was paid off. JOURNAL SN Particulars LF Debit(Rs) Credit(Rs) a) Realisation account –Dr A’s Capital account (Being commission given to A) 4000 4000 b) A’s Capital account –Dr B’s Capital account –Dr Advertisement Suspense account (Being Advertisement suspense written off) 14000 14000 28000 c) Realisation account –Dr Cash account (Being creditors paid off) 13000 13000 d) B’s Capital account –Dr Realisation account (Being asset taken over by the partner) 4900 4900 e) A’s Loan account –Dr Cash account (Being partners loan paid off) 15000 15000 f) Realisation account -- Dr Cash account (Being Bank loan paid off) 12000 12000 X and Y are partners in the firm who decided to dissolve the firm. Assets and Liabilities are transferred to Realisation account. Pass necessary journal entries— Creditors were Rs 1,00,000. They accepted Building valued Rs 1,40,000 and paid cash to the firm Rs 40,000 Aman, an old customer whose account of Rs 1000 was written off as bad in the previous year paid 40% of the amount. There were 300 shares of Rs 10 each in ABC Ltd which were acquired for Rs 2000 were now valued at Rs 6 each. These were taken over by the partners in the profit sharing ratio. Profit on Realisation Rs 42000 was divided among the partners. Land and Building (Book value Rs 1, 60,000) was sold for Rs 3,00,000 through a broker who charged 2% commission on the deal. Plant and machinery (Book value Rs 60,000) was handed over to the creditor in full settlement of his claim.
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