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Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce PDF Download

Page No 7.63:
Question 35:
Rita and Sobha are partners in a firm, Fancy Garments Exports, sharing profits and losses equally. On 1st April, 2019, the Balance Sheet of the firm was:
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

The firm was dissolved on the date given above. The following transactions took place:
(a) Rita took 25% of the Stock at a discount of 20% in settlement of her loan.
(b) Book Debts realised ₹ 54,000; balance of the Stock was sold at a profit of 30% on cost.
(c) Sundry Creditors were paid out at a discount of 10%. Bills Payable were paid in full .
(d) Plant and Machinery realised ₹ 75,000. Land and Building ₹ 1,20,000.
(e) Rita took the goodwill of the firm at a value of ₹ 30,000.
(f) An unrecorded asset of ₹ 6,900 was handed over to an unrecorded liability of ₹ 6,000 in full settlement.
(g) Realisation expenses were ₹ 5,250.
Show Realisation Account, Partners' Capital Accounts and Bank Account in the books of the firm.
ANSWER:
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

Working Notes:

WN1: Value of Stock Taken Over by Rita
[Since stock is taken over at a discount of 20%]
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
WN2: Value of Stock Sold
Book Value of Balance of Stock Sold=Value of Stock − Stock Taken over by Rita
Book Value of Balance of Stock Sold=₹(75,000 − 18,750)= ₹56,250
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

Page No 7.63:
Question 36:
Following is the Balance Sheet of Arvind and Balbir as at 31st March, 2019:
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

 The firm was dissolved on the above date under the following arrangement:
(a) Arvind promised to pay off Mrs. Arvind's Loan and took Stock at ₹ 6,000.
(b) Balbir took half the Investments @ 10% discount.
(c) Book Debts realised ₹ 28,500.
(d) Trade Creditors and Bills Payable were due on average basis of one month after 31st March, but were paid immediately on 31st March @ 2% discount per annum.
(e) Plant realised ₹ 37,500; Building ₹ 60,000; Goodwill ₹ 9,000 and remaining Investments ₹ 6,750.
(f) An old typewriter, written off completely from the firm's books, now estimated to realise ₹ 450. It was taken by Balbir at this estimated price.
(g) Realisation expenses were ₹ 1,500.
Show Realisation Account, Capital Accounts of Partners and Bank Account.
ANSWER:
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce


Page No 7.64:
Question 37:
Anju, Manju and Sanju were partners in a firm sharing profits in the ratio of 2 : 2 : 1. On 31st March, 2019, their Balance Sheet was:
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

On this date, the firm was dissolved. Anju was appointed to realise the assets. Anju was to receive 5% commission on the sale of assets (except cash) and was to bear all expenses of realisation.
Anju realised the assets as follows: Debtors ₹ 60,000; Stock ₹ 35,500; Investments ₹ 16,000; Plant 90% of the book value. Expenses of Realisation amounted to ₹ 7,500. Commission received in advance was returned to customers after deducting ₹ 3,000.
Firm had to pay ₹ 8,500 for Outstanding Salary, not provided for earlier, Compensation paid to employees amounted to ₹ 17,000. This liability was not provided for in the above Balance Sheet. ₹ 20,000 had to be paid for Employees' Provident Fund.
Prepare Realisation Account, Capital Accounts of Partners and Cash Account.
ANSWER:

Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

Page No 7.64:
Question 38:
A, B and C were in partnership sharing profits in the ratio of 7 : 2 : 1 and the Balance Sheet of the firm as at 31st March, 2019 was:

Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

It was agreed to dissolve the partnership as on 31st March, 2019 and the terms of dissolution were−
(a) A to take over the Building at an agreed amount of ₹ 31,500.
(b) B, who was to carry on the business, to take over the Goodwill, Stock and Debtors at book value, the Patents at ₹ 30,000 and Plant at ₹ 5,000. He was also to pay the Creditors.
(c) C to take over shares in X Ltd. at ₹ 15 each.
(d) The shares in Y Ltd. to be divided in the profit-sharing ratio.
Show Ledger Accounts recording the dissolution in the books of the firm.
ANSWER:

Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Working Notes:
Distribution of Shares in Y Ltd.
Distribution of shares in Y Ltd. among the partners
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

Page No 7.65:
Question 39:
Srijan, Raman and Manan were partners in a firm sharing profits and losses in the ratio of 2 : 2 : 1. On 31st, March, 2017 their Balance Sheet was as follows:
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

On the above date they decided to dissolve the firm.
(a) Srijan was appointed to realise the assets and discharge the liabilities. Srijan was to receive 5% commission on sale of assets (except cash) and was to bear all expenses of realisation.
(b)
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

(c) Investments were realised at 95% of the book value.
(d) The firm had to pay ₹ 7,500 for an outstanding repair bill not provided for earlier.
(e) A contingent liabillity in respect of bills receivable, discounted with the bank had also materialised and had to be discharged for ₹ 15,000.
(f) Expenses of realisation amounting to ₹ 3,000 were paid by Srijan.
Prepare Realisation Account, Partners' Capital Accounts and Bank Account.
ANSWER:

Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce


Question 40:
A, B and C were partners sharing profits in the ratio of 2 : 2 : 1. They decided to dissolve their firm on 31st March, 2019 when the Balance Sheet was:
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

Following transactions took place:
(a) A took over Stock at ₹ 36,000. He also took over his wife's loan.
(b) B took over half of Debtors at ₹ 28,000.
(c) C took over Investments at ₹ 54,000 and half of Creditors at their book value.
(d) Remaining Debtors realised 60% of their book value. Furniture sold for ₹ 30,000; Machinery ₹ 82,000 and Land ₹ 1,20,000.
(e) An unrecorded asset was sold for ₹ 22,000.
(f) Realisation expenses amounted to ₹ 4,000.
Prepare necessary Ledger Accounts to close the books of the firm.
ANSWER:

Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

Page No 7.66:
Question 41:
Krishna and Arjun are partners in a firm. They share profits in the ratio of 4 : 1. They decide to dissolve the firm on 31st March, 2019 at which date their Balance Sheet stood as:
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

The realisation shows the following results:
(a) Goodwill was sold for ₹ 1,000.
(b) Debtors were realised at book value less 10%.
(c) Trademarks realised ₹ 800.
(d) Machinery and Stock-in-Trade were taken by Krishna for ₹ 14,400 and ₹ 3,600 respectively.
(e) An unrecorded asset estimated at ₹ 500 was sold for ₹ 200.
(f) Creditors for goods were settled at a discount of ₹ 80. The expenses on realisation were ₹ 800.
Prepare Realisation Account, Partners' Capital Accounts and Bank Account.
ANSWER:

Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

Question 42:
There are two partners X and Y in a firm and their capitals are ₹ 50,000 and ₹ 40,000. The creditors are ₹ 30,000. The assets of the firm realise ₹ 1,00,000. How much will X and Y receive?
ANSWER:

Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

Question 43:
A, B and C were partners sharing profits in the ratio of 5 : 3 : 2. On 31st March, 2019, A's Capital and B's Capital were ₹ 30,000 and ₹ 20,000 respectively but C owed ₹ 5,000 to the firm. The liabilities were ₹ 20,000. The assets of the firm realised ₹ 50,000. 
Prepare Realisation Account, Partner's Capital Accounts and Bank Account.
ANSWER:
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
WN 2
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

Question 54:

X, Y and Z entered into partnership on 1st April, 2016. They contributed capital ₹ 40,000, ₹ 30,000 and ₹ 20,000 respectively and agreed to share profits in the ratio of 3 : 2 : 1. Interest on capital was to be allowed @ 15% p.a. and interest on drawings was to be charged at an average rate of 5%. During the two years ended 31st March, 2018, the firm made profit of ₹ 21,600 and ₹ 25,140 respectively before allowing or charging interest on capital and drawings. The drawings of each partner were ₹ 6,000 per year.
On 31st March, 2018, the partners decided to dissolve the partnership due to difference of opinion. On that date, the creditors amounted to ₹ 20,000. The assets, other than cash ₹ 2,000, realised ₹ 1,21,000. Expenses of dissolution amounted to ₹ 760.
Draw up necessary Ledger Accounts to close the books of the firm.
ANSWER:

Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce
Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce

The document Dissolution of a Partnership Firm ( Part - 3) | Accountancy Class 12 - Commerce is a part of the Commerce Course Accountancy Class 12.
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FAQs on Dissolution of a Partnership Firm ( Part - 3) - Accountancy Class 12 - Commerce

1. What is the process of dissolving a partnership firm?
Ans. The process of dissolving a partnership firm involves several steps. Firstly, the partners need to agree on the dissolution and communicate their decision to all relevant parties. Then, they must settle all debts and liabilities of the firm by paying off creditors and collecting outstanding dues. Next, the partners need to liquidate the assets of the firm and distribute the remaining proceeds among themselves according to their agreed-upon profit-sharing ratio. Finally, the firm's registration should be cancelled with the appropriate government authorities.
2. How can disputes among partners be resolved during the dissolution of a partnership firm?
Ans. Disputes among partners during the dissolution of a partnership firm can be resolved through negotiation, mediation, or arbitration. It is important for the partners to communicate openly and honestly about their concerns and try to find an amicable solution. If they are unable to resolve the dispute themselves, they can seek the assistance of a neutral third party, such as a mediator or arbitrator, who can help facilitate the resolution process. If all else fails, the partners may need to resort to legal action and have the dispute settled in court.
3. What are the legal formalities required for the dissolution of a partnership firm?
Ans. The legal formalities required for the dissolution of a partnership firm may vary depending on the jurisdiction and the terms of the partnership agreement. However, some common legal formalities include drafting a dissolution agreement or deed that outlines the terms and conditions of the dissolution, obtaining consent from all partners, settling all outstanding debts and liabilities, notifying relevant government authorities, and canceling the firm's registration. It is advisable to consult with a legal professional to ensure compliance with all necessary legal requirements.
4. Can a partnership firm be dissolved without the consent of all partners?
Ans. Generally, a partnership firm cannot be dissolved without the consent of all partners. The dissolution of a partnership firm requires the unanimous agreement of all partners as it is a mutual decision that affects the rights and obligations of each partner. However, in some cases, the partnership agreement may provide provisions for dissolution with the consent of a specified majority or in certain circumstances, such as the death or bankruptcy of a partner. It is important to refer to the partnership agreement and seek legal advice to determine the specific requirements for dissolution.
5. What are the tax implications of dissolving a partnership firm?
Ans. The tax implications of dissolving a partnership firm can vary depending on factors such as the jurisdiction, the nature of the firm's assets and liabilities, and the manner in which the dissolution is carried out. Generally, the firm may be required to file final tax returns and settle any outstanding tax liabilities. The partners may also need to report their share of the firm's assets and liabilities on their individual tax returns. It is advisable to consult with a tax professional or accountant to understand the specific tax implications and requirements for dissolving a partnership firm.
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