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Read the following information and answer the questions that follows: Mehta and Menon were partners in a firm sharing profits and losses in the ratio of 7 : 3. They decided to dissolve firm on 31st March, 2016 on that date, their books showed the following ledger account balances :
₹
Sundry Creditors 27,000
Profit & Loss A/c (Dr.) 8,000
Cash in hand 6,000
Bank Loan 20,000
Bills Payable 5,000
Sundry Assets 1,98,000
Capital A/cs :
Mehta 1,12,000
Menon 48,000
Additional information :
(i) Bills payable falling due on 31st May, 2016 retired on the date of dissolution of the firm at a rebate of 6% per annum.
(ii) The bankers accepted the furniture (included in sundry assets) having a book value of ₹18,000 in full settlement of the loan given by them.
(iii) Remaining assets were sold for ₹ 1,50,000.
(iv) Liability on account of outstanding salary not recorded in the books, amounting to ₹15,000 was met.
(v) Menon agreed to take over the responsibility of completing the dissolution work to bear all expenses of realization at an agreed remuneration of ₹2,000. The actual realization expenses were ₹1,500 which were paid by the firm on behalf of Menon.
Consider the following Accounts:
(i) Mehta’s Capital Account
(ii) Menon’s Capital Account
(iii) Realisation Account
(iv) Profit and Loss Account
Q. Which account will be affected by the realisation expenses paid by Menon?
- a)(i) only
- b)(ii) and (iii)
- c)(i) and (iii)
- d)(i), (ii) and (iii)
Correct answer is option 'B'. Can you explain this answer?
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Read the following information and answer the questions that follows:...
Realisation A /c Dr. 5,600
To Menon’s Capital A /c 5,600
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Read the following information and answer the questions that follows:...
Understanding the Realisation Expenses
In the dissolution of a partnership firm, various accounts are affected, especially when it comes to realization expenses. Here’s how Menon's payment for the realization expenses impacts different accounts.
Accounts Impacted by Realization Expenses
- (ii) Menon’s Capital Account:
Menon agreed to take over the responsibility of completing the dissolution work and is entitled to remuneration. The realization expenses of ₹1,500 paid by the firm will decrease Menon’s Capital Account since it is effectively reducing the amount he can claim upon dissolution.
- (iii) Realisation Account:
The Realisation Account is used to record all transactions related to the dissolution of the firm. The ₹1,500 paid for realization expenses will be debited to the Realisation Account, as it represents an outflow of cash related to the dissolution process. This account ultimately summarizes the profits or losses from the realization of assets and settlement of liabilities.
Conclusion
Thus, the correct answer is option 'B', as both Menon’s Capital Account (ii) and the Realisation Account (iii) are affected by the realization expenses paid by Menon. The first account reflects Menon’s decreasing capital due to the payment, while the second account records the expense directly related to the dissolution process.
By understanding how these accounts interact during the dissolution phase, one can appreciate the financial implications for each partner effectively.
In the dissolution of a partnership firm, various accounts are affected, especially when it comes to realization expenses. Here’s how Menon's payment for the realization expenses impacts different accounts.
Accounts Impacted by Realization Expenses
- (ii) Menon’s Capital Account:
Menon agreed to take over the responsibility of completing the dissolution work and is entitled to remuneration. The realization expenses of ₹1,500 paid by the firm will decrease Menon’s Capital Account since it is effectively reducing the amount he can claim upon dissolution.
- (iii) Realisation Account:
The Realisation Account is used to record all transactions related to the dissolution of the firm. The ₹1,500 paid for realization expenses will be debited to the Realisation Account, as it represents an outflow of cash related to the dissolution process. This account ultimately summarizes the profits or losses from the realization of assets and settlement of liabilities.
Conclusion
Thus, the correct answer is option 'B', as both Menon’s Capital Account (ii) and the Realisation Account (iii) are affected by the realization expenses paid by Menon. The first account reflects Menon’s decreasing capital due to the payment, while the second account records the expense directly related to the dissolution process.
By understanding how these accounts interact during the dissolution phase, one can appreciate the financial implications for each partner effectively.
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Read the following information and answer the questions that follows: Mehta and Menon were partners in a firm sharing profits and losses in the ratio of 7 : 3. They decided to dissolve firm on 31st March, 2016 on that date, their books showed the following ledger account balances :₹Sundry Creditors 27,000Profit & Loss A/c (Dr.) 8,000Cash in hand 6,000Bank Loan 20,000Bills Payable 5,000Sundry Assets 1,98,000Capital A/cs :Mehta 1,12,000Menon 48,000Additional information :(i) Bills payable falling due on 31st May, 2016 retired on the date of dissolution of the firm at a rebate of 6% per annum.(ii) The bankers accepted the furniture (included in sundry assets) having a book value of ₹18,000 in full settlement of the loan given by them.(iii) Remaining assets were sold for ₹ 1,50,000.(iv) Liability on account of outstanding salary not recorded in the books, amounting to ₹15,000 was met.(v) Menon agreed to take over the responsibility of completing the dissolution work to bear all expenses of realization at an agreed remuneration of ₹2,000. The actual realization expenses were ₹1,500 which were paid by the firm on behalf of Menon.Consider the following Accounts:(i) Mehta’s Capital Account(ii) Menon’s Capital Account(iii) Realisation Account(iv) Profit and Loss AccountQ. Which account will be affected by the realisation expenses paid by Menon?a)(i) onlyb)(ii) and (iii)c)(i) and (iii)d)(i), (ii) and (iii)Correct answer is option 'B'. Can you explain this answer?
Question Description
Read the following information and answer the questions that follows: Mehta and Menon were partners in a firm sharing profits and losses in the ratio of 7 : 3. They decided to dissolve firm on 31st March, 2016 on that date, their books showed the following ledger account balances :₹Sundry Creditors 27,000Profit & Loss A/c (Dr.) 8,000Cash in hand 6,000Bank Loan 20,000Bills Payable 5,000Sundry Assets 1,98,000Capital A/cs :Mehta 1,12,000Menon 48,000Additional information :(i) Bills payable falling due on 31st May, 2016 retired on the date of dissolution of the firm at a rebate of 6% per annum.(ii) The bankers accepted the furniture (included in sundry assets) having a book value of ₹18,000 in full settlement of the loan given by them.(iii) Remaining assets were sold for ₹ 1,50,000.(iv) Liability on account of outstanding salary not recorded in the books, amounting to ₹15,000 was met.(v) Menon agreed to take over the responsibility of completing the dissolution work to bear all expenses of realization at an agreed remuneration of ₹2,000. The actual realization expenses were ₹1,500 which were paid by the firm on behalf of Menon.Consider the following Accounts:(i) Mehta’s Capital Account(ii) Menon’s Capital Account(iii) Realisation Account(iv) Profit and Loss AccountQ. Which account will be affected by the realisation expenses paid by Menon?a)(i) onlyb)(ii) and (iii)c)(i) and (iii)d)(i), (ii) and (iii)Correct answer is option 'B'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Read the following information and answer the questions that follows: Mehta and Menon were partners in a firm sharing profits and losses in the ratio of 7 : 3. They decided to dissolve firm on 31st March, 2016 on that date, their books showed the following ledger account balances :₹Sundry Creditors 27,000Profit & Loss A/c (Dr.) 8,000Cash in hand 6,000Bank Loan 20,000Bills Payable 5,000Sundry Assets 1,98,000Capital A/cs :Mehta 1,12,000Menon 48,000Additional information :(i) Bills payable falling due on 31st May, 2016 retired on the date of dissolution of the firm at a rebate of 6% per annum.(ii) The bankers accepted the furniture (included in sundry assets) having a book value of ₹18,000 in full settlement of the loan given by them.(iii) Remaining assets were sold for ₹ 1,50,000.(iv) Liability on account of outstanding salary not recorded in the books, amounting to ₹15,000 was met.(v) Menon agreed to take over the responsibility of completing the dissolution work to bear all expenses of realization at an agreed remuneration of ₹2,000. The actual realization expenses were ₹1,500 which were paid by the firm on behalf of Menon.Consider the following Accounts:(i) Mehta’s Capital Account(ii) Menon’s Capital Account(iii) Realisation Account(iv) Profit and Loss AccountQ. Which account will be affected by the realisation expenses paid by Menon?a)(i) onlyb)(ii) and (iii)c)(i) and (iii)d)(i), (ii) and (iii)Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Read the following information and answer the questions that follows: Mehta and Menon were partners in a firm sharing profits and losses in the ratio of 7 : 3. They decided to dissolve firm on 31st March, 2016 on that date, their books showed the following ledger account balances :₹Sundry Creditors 27,000Profit & Loss A/c (Dr.) 8,000Cash in hand 6,000Bank Loan 20,000Bills Payable 5,000Sundry Assets 1,98,000Capital A/cs :Mehta 1,12,000Menon 48,000Additional information :(i) Bills payable falling due on 31st May, 2016 retired on the date of dissolution of the firm at a rebate of 6% per annum.(ii) The bankers accepted the furniture (included in sundry assets) having a book value of ₹18,000 in full settlement of the loan given by them.(iii) Remaining assets were sold for ₹ 1,50,000.(iv) Liability on account of outstanding salary not recorded in the books, amounting to ₹15,000 was met.(v) Menon agreed to take over the responsibility of completing the dissolution work to bear all expenses of realization at an agreed remuneration of ₹2,000. The actual realization expenses were ₹1,500 which were paid by the firm on behalf of Menon.Consider the following Accounts:(i) Mehta’s Capital Account(ii) Menon’s Capital Account(iii) Realisation Account(iv) Profit and Loss AccountQ. Which account will be affected by the realisation expenses paid by Menon?a)(i) onlyb)(ii) and (iii)c)(i) and (iii)d)(i), (ii) and (iii)Correct answer is option 'B'. Can you explain this answer?.
Read the following information and answer the questions that follows: Mehta and Menon were partners in a firm sharing profits and losses in the ratio of 7 : 3. They decided to dissolve firm on 31st March, 2016 on that date, their books showed the following ledger account balances :₹Sundry Creditors 27,000Profit & Loss A/c (Dr.) 8,000Cash in hand 6,000Bank Loan 20,000Bills Payable 5,000Sundry Assets 1,98,000Capital A/cs :Mehta 1,12,000Menon 48,000Additional information :(i) Bills payable falling due on 31st May, 2016 retired on the date of dissolution of the firm at a rebate of 6% per annum.(ii) The bankers accepted the furniture (included in sundry assets) having a book value of ₹18,000 in full settlement of the loan given by them.(iii) Remaining assets were sold for ₹ 1,50,000.(iv) Liability on account of outstanding salary not recorded in the books, amounting to ₹15,000 was met.(v) Menon agreed to take over the responsibility of completing the dissolution work to bear all expenses of realization at an agreed remuneration of ₹2,000. The actual realization expenses were ₹1,500 which were paid by the firm on behalf of Menon.Consider the following Accounts:(i) Mehta’s Capital Account(ii) Menon’s Capital Account(iii) Realisation Account(iv) Profit and Loss AccountQ. Which account will be affected by the realisation expenses paid by Menon?a)(i) onlyb)(ii) and (iii)c)(i) and (iii)d)(i), (ii) and (iii)Correct answer is option 'B'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Read the following information and answer the questions that follows: Mehta and Menon were partners in a firm sharing profits and losses in the ratio of 7 : 3. They decided to dissolve firm on 31st March, 2016 on that date, their books showed the following ledger account balances :₹Sundry Creditors 27,000Profit & Loss A/c (Dr.) 8,000Cash in hand 6,000Bank Loan 20,000Bills Payable 5,000Sundry Assets 1,98,000Capital A/cs :Mehta 1,12,000Menon 48,000Additional information :(i) Bills payable falling due on 31st May, 2016 retired on the date of dissolution of the firm at a rebate of 6% per annum.(ii) The bankers accepted the furniture (included in sundry assets) having a book value of ₹18,000 in full settlement of the loan given by them.(iii) Remaining assets were sold for ₹ 1,50,000.(iv) Liability on account of outstanding salary not recorded in the books, amounting to ₹15,000 was met.(v) Menon agreed to take over the responsibility of completing the dissolution work to bear all expenses of realization at an agreed remuneration of ₹2,000. The actual realization expenses were ₹1,500 which were paid by the firm on behalf of Menon.Consider the following Accounts:(i) Mehta’s Capital Account(ii) Menon’s Capital Account(iii) Realisation Account(iv) Profit and Loss AccountQ. Which account will be affected by the realisation expenses paid by Menon?a)(i) onlyb)(ii) and (iii)c)(i) and (iii)d)(i), (ii) and (iii)Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Read the following information and answer the questions that follows: Mehta and Menon were partners in a firm sharing profits and losses in the ratio of 7 : 3. They decided to dissolve firm on 31st March, 2016 on that date, their books showed the following ledger account balances :₹Sundry Creditors 27,000Profit & Loss A/c (Dr.) 8,000Cash in hand 6,000Bank Loan 20,000Bills Payable 5,000Sundry Assets 1,98,000Capital A/cs :Mehta 1,12,000Menon 48,000Additional information :(i) Bills payable falling due on 31st May, 2016 retired on the date of dissolution of the firm at a rebate of 6% per annum.(ii) The bankers accepted the furniture (included in sundry assets) having a book value of ₹18,000 in full settlement of the loan given by them.(iii) Remaining assets were sold for ₹ 1,50,000.(iv) Liability on account of outstanding salary not recorded in the books, amounting to ₹15,000 was met.(v) Menon agreed to take over the responsibility of completing the dissolution work to bear all expenses of realization at an agreed remuneration of ₹2,000. The actual realization expenses were ₹1,500 which were paid by the firm on behalf of Menon.Consider the following Accounts:(i) Mehta’s Capital Account(ii) Menon’s Capital Account(iii) Realisation Account(iv) Profit and Loss AccountQ. Which account will be affected by the realisation expenses paid by Menon?a)(i) onlyb)(ii) and (iii)c)(i) and (iii)d)(i), (ii) and (iii)Correct answer is option 'B'. Can you explain this answer?.
Solutions for Read the following information and answer the questions that follows: Mehta and Menon were partners in a firm sharing profits and losses in the ratio of 7 : 3. They decided to dissolve firm on 31st March, 2016 on that date, their books showed the following ledger account balances :₹Sundry Creditors 27,000Profit & Loss A/c (Dr.) 8,000Cash in hand 6,000Bank Loan 20,000Bills Payable 5,000Sundry Assets 1,98,000Capital A/cs :Mehta 1,12,000Menon 48,000Additional information :(i) Bills payable falling due on 31st May, 2016 retired on the date of dissolution of the firm at a rebate of 6% per annum.(ii) The bankers accepted the furniture (included in sundry assets) having a book value of ₹18,000 in full settlement of the loan given by them.(iii) Remaining assets were sold for ₹ 1,50,000.(iv) Liability on account of outstanding salary not recorded in the books, amounting to ₹15,000 was met.(v) Menon agreed to take over the responsibility of completing the dissolution work to bear all expenses of realization at an agreed remuneration of ₹2,000. The actual realization expenses were ₹1,500 which were paid by the firm on behalf of Menon.Consider the following Accounts:(i) Mehta’s Capital Account(ii) Menon’s Capital Account(iii) Realisation Account(iv) Profit and Loss AccountQ. Which account will be affected by the realisation expenses paid by Menon?a)(i) onlyb)(ii) and (iii)c)(i) and (iii)d)(i), (ii) and (iii)Correct answer is option 'B'. Can you explain this answer? in English & in Hindi are available as part of our courses for Commerce.
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Here you can find the meaning of Read the following information and answer the questions that follows: Mehta and Menon were partners in a firm sharing profits and losses in the ratio of 7 : 3. They decided to dissolve firm on 31st March, 2016 on that date, their books showed the following ledger account balances :₹Sundry Creditors 27,000Profit & Loss A/c (Dr.) 8,000Cash in hand 6,000Bank Loan 20,000Bills Payable 5,000Sundry Assets 1,98,000Capital A/cs :Mehta 1,12,000Menon 48,000Additional information :(i) Bills payable falling due on 31st May, 2016 retired on the date of dissolution of the firm at a rebate of 6% per annum.(ii) The bankers accepted the furniture (included in sundry assets) having a book value of ₹18,000 in full settlement of the loan given by them.(iii) Remaining assets were sold for ₹ 1,50,000.(iv) Liability on account of outstanding salary not recorded in the books, amounting to ₹15,000 was met.(v) Menon agreed to take over the responsibility of completing the dissolution work to bear all expenses of realization at an agreed remuneration of ₹2,000. The actual realization expenses were ₹1,500 which were paid by the firm on behalf of Menon.Consider the following Accounts:(i) Mehta’s Capital Account(ii) Menon’s Capital Account(iii) Realisation Account(iv) Profit and Loss AccountQ. Which account will be affected by the realisation expenses paid by Menon?a)(i) onlyb)(ii) and (iii)c)(i) and (iii)d)(i), (ii) and (iii)Correct answer is option 'B'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
Read the following information and answer the questions that follows: Mehta and Menon were partners in a firm sharing profits and losses in the ratio of 7 : 3. They decided to dissolve firm on 31st March, 2016 on that date, their books showed the following ledger account balances :₹Sundry Creditors 27,000Profit & Loss A/c (Dr.) 8,000Cash in hand 6,000Bank Loan 20,000Bills Payable 5,000Sundry Assets 1,98,000Capital A/cs :Mehta 1,12,000Menon 48,000Additional information :(i) Bills payable falling due on 31st May, 2016 retired on the date of dissolution of the firm at a rebate of 6% per annum.(ii) The bankers accepted the furniture (included in sundry assets) having a book value of ₹18,000 in full settlement of the loan given by them.(iii) Remaining assets were sold for ₹ 1,50,000.(iv) Liability on account of outstanding salary not recorded in the books, amounting to ₹15,000 was met.(v) Menon agreed to take over the responsibility of completing the dissolution work to bear all expenses of realization at an agreed remuneration of ₹2,000. The actual realization expenses were ₹1,500 which were paid by the firm on behalf of Menon.Consider the following Accounts:(i) Mehta’s Capital Account(ii) Menon’s Capital Account(iii) Realisation Account(iv) Profit and Loss AccountQ. Which account will be affected by the realisation expenses paid by Menon?a)(i) onlyb)(ii) and (iii)c)(i) and (iii)d)(i), (ii) and (iii)Correct answer is option 'B'. Can you explain this answer?, a detailed solution for Read the following information and answer the questions that follows: Mehta and Menon were partners in a firm sharing profits and losses in the ratio of 7 : 3. They decided to dissolve firm on 31st March, 2016 on that date, their books showed the following ledger account balances :₹Sundry Creditors 27,000Profit & Loss A/c (Dr.) 8,000Cash in hand 6,000Bank Loan 20,000Bills Payable 5,000Sundry Assets 1,98,000Capital A/cs :Mehta 1,12,000Menon 48,000Additional information :(i) Bills payable falling due on 31st May, 2016 retired on the date of dissolution of the firm at a rebate of 6% per annum.(ii) The bankers accepted the furniture (included in sundry assets) having a book value of ₹18,000 in full settlement of the loan given by them.(iii) Remaining assets were sold for ₹ 1,50,000.(iv) Liability on account of outstanding salary not recorded in the books, amounting to ₹15,000 was met.(v) Menon agreed to take over the responsibility of completing the dissolution work to bear all expenses of realization at an agreed remuneration of ₹2,000. The actual realization expenses were ₹1,500 which were paid by the firm on behalf of Menon.Consider the following Accounts:(i) Mehta’s Capital Account(ii) Menon’s Capital Account(iii) Realisation Account(iv) Profit and Loss AccountQ. Which account will be affected by the realisation expenses paid by Menon?a)(i) onlyb)(ii) and (iii)c)(i) and (iii)d)(i), (ii) and (iii)Correct answer is option 'B'. Can you explain this answer? has been provided alongside types of Read the following information and answer the questions that follows: Mehta and Menon were partners in a firm sharing profits and losses in the ratio of 7 : 3. They decided to dissolve firm on 31st March, 2016 on that date, their books showed the following ledger account balances :₹Sundry Creditors 27,000Profit & Loss A/c (Dr.) 8,000Cash in hand 6,000Bank Loan 20,000Bills Payable 5,000Sundry Assets 1,98,000Capital A/cs :Mehta 1,12,000Menon 48,000Additional information :(i) Bills payable falling due on 31st May, 2016 retired on the date of dissolution of the firm at a rebate of 6% per annum.(ii) The bankers accepted the furniture (included in sundry assets) having a book value of ₹18,000 in full settlement of the loan given by them.(iii) Remaining assets were sold for ₹ 1,50,000.(iv) Liability on account of outstanding salary not recorded in the books, amounting to ₹15,000 was met.(v) Menon agreed to take over the responsibility of completing the dissolution work to bear all expenses of realization at an agreed remuneration of ₹2,000. The actual realization expenses were ₹1,500 which were paid by the firm on behalf of Menon.Consider the following Accounts:(i) Mehta’s Capital Account(ii) Menon’s Capital Account(iii) Realisation Account(iv) Profit and Loss AccountQ. Which account will be affected by the realisation expenses paid by Menon?a)(i) onlyb)(ii) and (iii)c)(i) and (iii)d)(i), (ii) and (iii)Correct answer is option 'B'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice Read the following information and answer the questions that follows: Mehta and Menon were partners in a firm sharing profits and losses in the ratio of 7 : 3. They decided to dissolve firm on 31st March, 2016 on that date, their books showed the following ledger account balances :₹Sundry Creditors 27,000Profit & Loss A/c (Dr.) 8,000Cash in hand 6,000Bank Loan 20,000Bills Payable 5,000Sundry Assets 1,98,000Capital A/cs :Mehta 1,12,000Menon 48,000Additional information :(i) Bills payable falling due on 31st May, 2016 retired on the date of dissolution of the firm at a rebate of 6% per annum.(ii) The bankers accepted the furniture (included in sundry assets) having a book value of ₹18,000 in full settlement of the loan given by them.(iii) Remaining assets were sold for ₹ 1,50,000.(iv) Liability on account of outstanding salary not recorded in the books, amounting to ₹15,000 was met.(v) Menon agreed to take over the responsibility of completing the dissolution work to bear all expenses of realization at an agreed remuneration of ₹2,000. The actual realization expenses were ₹1,500 which were paid by the firm on behalf of Menon.Consider the following Accounts:(i) Mehta’s Capital Account(ii) Menon’s Capital Account(iii) Realisation Account(iv) Profit and Loss AccountQ. Which account will be affected by the realisation expenses paid by Menon?a)(i) onlyb)(ii) and (iii)c)(i) and (iii)d)(i), (ii) and (iii)Correct answer is option 'B'. Can you explain this answer? tests, examples and also practice Commerce tests.
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