Correct option is A
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Reading Comprehension
Based on following case, answer question.
Nayana and Arushi were partners sharing profit equally. Their Balance Sheet as at March 31, 2017 was as follows:
The firm was dissolved on the above date :
(1) Nayana took over 50% of the stock at 10% less on its book value, and the remaining stock was sold at a gain of 15%. Furniture and Machinery realised for ₹30,000 and ₹50,000 respectively.
(2) There was an unrecorded investment which was sold for ₹34,000.
(3) Debtors realised 90% only and ₹1,200 were recovered for bad debts written-off last year.
(4) There was an outstanding bill for repairs which had to be paid for ₹2,000.
1) Question
Calculate the amount realised from remaining stock sold at a gain of 15%.
2) Question
Calculate the amount paid to creditors:
Correct option is D
Since, nothing is mentioned about the payment to creditors, it will be assumed to have been paid in full. Hence, amount paid to creditors in this case will be ₹20,000.
3) Question
What will be the treatment of Workmen Compensation Reserve at the time of dissolution?
Correct option is D
Workmen compensation reserve will be distributed among all the partners in old ratio.
Hence the journal entry will be:
4) Question
How treatment will be done to the current account of partner at the time of dissolution of firm?
Correct option is A
At the time of the dissolution of a firm, all the necessary transactions are done in partners' current accounts, and the balance is transferred to the fixed capital account of the partner. This process ensures a clear record of the partner's financial position during the dissolution process.
5) Question
Calculate the total amount realised in Cash/ Bank at the time of dissolution of the firm from sale of assets & recovery:
Correct option is B
Total amount realised = Stock + Furniture + Machinery + Unrecorded Investment + Bad Debt Recovered + Debtors
Total amount realised = ₹20,125+₹30,000+₹50,000+₹34,000+₹1,200+₹22,500 = ₹1,57,825
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EnglishSimilar Questions
- 1)
What is the mode of dissolution of the firm followed by G, K and B ?
- 2)On dissolution of a firm, bank overdraft is transferred to:
- 3)Calculate the amount to be debited on the dissolution of partnership firm if Debtors of ₹25,000, realised 90% only and ₹1,200 were recovered for bad debts written off last year.
- 4)For which of the following, situations "No entry" will be passed at the time of Dissolution of firm when all the assets and Liabilities were already transferred.
A. Creditors of ₹50,000 were settled by giving stock of ₹60,000 in full settlement.
B. Loan to B of ₹60,000 was settled at ₹55,000 (B is a partner).
C. Realisation expense amounted to ₹5,000. Debtor of ₹8,000 paid these expenses in full settlement
D. Realisation expenses amounted to ₹10,000 were to be borne by C, a partner and were paid by him personally.
E. A's Loan to firm of ₹25,000 was settled by giving him furniture of same amount
Choose the correct answer from the options given below: - 5)Ram and Mohan were in partnership sharing profits and losses in ratio of 3:2. Investments stood in Balance Sheet at ₹1,40,000 on dissolution of firm. Ram took over some of Investments at ₹8,100 (book value less 10%) while remaining investment were taken over by Mohan at 90% of book value less ₹900 discount. At what value, did Mohan take over investment?
- 6)Unrecorded assets when taken over by a partner are shown in
- 7)Creditors having book value of ₹1,00,000 and furniture having book value of ₹70,000 were appearing in the Balance sheet of a partnership firm. On 31st March, 2022 the firm was dissolved and creditors decided to take over furniture at 80% of book value and balance were settled at 10% discount. Identify the correct option on the basis of above information.
- 8)As per Section. 48 of Partnership Act, what is the correct sequence to be Followed at the time of dissolution of Partnership Firm?
A. Payment for Partner's Loan
B. Payment for Partner's Capital Dues
C. Payment outsider's Liabilities
D. Surplus, if any distributed amongst partners
Choose the correct answer from the options given below: - 9)Which of the following are true in respect of Dissolution of a Partnership firm :
(A) The Assets of the firm, shall be applied, firstly for paying the debts of the firms to the third parties.
(B) When the partner becomes insane, the partnership firm can be dissolved.
(C) The nature of Realisation Account is nominal Account.
(D) There is no difference in the treatment of Partner's Loan and his/her spouse loan.
(E) Realisation Profit/Loss is distributed in the Capital Ratio when the deed is silent.
Choose the correct answer from the options given below : - 10)On dissolution of a partnership firm, partner’s capital accounts are closed through which of the following account?
