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Test – Dissoloution of a Partnership Firm (Set – B)
1. Anita and Binita are partners in a firm. Anita had taken a loan of ₹15,000 from the firm. How will Anita's loan
be closed in the event of dissolution of the firm?
(A) By crediting it to Anita's Capital Account
(B) By debiting it to Anita's Capital Account
(C) By crediting it to Realisation Account
(D) By debiting it to Cash Account (1)
2. On dissolution of a firm, Sundry Creditors amounted to ₹1,00,000 out of which ₹5,000 were untraceable and
creditor of ₹20,000 was given an unrecorded computer of ₹10,000 in full settlement of his claim and the
remaining were paid at 80%. On payment of creditors Realisation account will be :
(A) Debited by ₹68,000 (C) Debited by ₹60,000
(B) Credited by ₹68,000 (D) Credited by ₹60,000 (1)
3. At the time of dissolution of a partnership firm, the book value of sundry assets transferred to Realisation
Account was ₹5,00,000. 40% of these sundry assets were taken by partner A at 20% discount, 60% of
remaining assets were sold at a profit of 20% on cost. 20% of the balance was found obsolete and realised
nothing. The remaining assets were taken over by a creditor in full settlement of his claim. Pass necessary
journal entry for the above (1)
4. A and B are partners in a firm sharing profits in the ratio of 3: 2. Mrs.A has given a loan of ₹20,000 to the firm
and the firm also obtained a loan of ₹10,000 from B. The firm was dissolved and its assets were realised for
₹25,000. State the order of payment of Mrs. A's Loan and B's Loan with reason, if there were no creditors of the
firm. (1)
5. On dissolution of a firm, out of the proceeds received from the sale of assets……… will be paid first of all. (A)
Partner's Capital (B) Partner's Loan to Firm
(C) Partner's additional capital (D) Outside Creditors (1)
6. On dissolution, goodwill account is transferred to :
(A) Dr. side of Realisation A/c (B) Cr. side of Realisation A/c
(C) Dr. side of Partner's Capital A/cs (D) Cr. side of Partner's Capital A/cs (1)
7. P, Q and R were partners in a firm sharing profits in the ratio of 7:2:1. On 31st March, 2021, the firm was
dissolved, after transferring sundry assets (other than cash in hand and cash at bank) and third party liabilities
in the realization account, the following transactions took place :
(i) Debtors amounting to ₹1,20,000 were handed over to a debt collection agency which charged 5%
commission. The remaining debtors were ₹27,000, out of which debtors of ₹17,000 could not be recovered
because the same became insolvent.
(ii) Creditors amounting to ₹7,000 were paid ₹5,500 in full settlement of their claim and balance creditors
were handed over stock of ₹70,000 in full settlement of their claim of ₹80,000.
(iii) A bills receivable ₹2,000 discounted with the bank was dishonoured by its acceptor and the same had to be
met by the firm. Pass necessary journal entries for the above transactions in the books of P, Q and R. (3)
ACCOUNTS BY VIJAY GOYAL, DSS-130, SEC-11, PKL & SCO-286, SEC-20, PKL, 9041672311, 8556888389
8. Chanda, Tara and Nisha were partners in a firm sharing profits and losses in the ratio of 3:2:1. They decided to
dissolve the firm on 31st March, 2021. Pass necessary Journal Entries for the following transactions after all
assets (other than cash and bank) and third party liabilities have been transferred to Realisation Account.
(i) A typewriter completely written off from the books was sold for ₹9,000.
(ii) Chanda took over stock worth ₹96,000 at ₹84,000.
(iii) Nisha was to get remuneration of ₹42,000 for completing the dissolution process.
(iv) Creditors of ₹23,500 took over all investments at ₹10,000. Remaining amount was paid to them in Cash.
(4)
9. A, B and C were partners sharing profits in 5: 3: 2. Their Balance Sheet as at 31st March, 2022 was as follows:
Liabilities Amt. (₹) Assets Amt. (₹)
Creditors 80,000 Cash at Bank 20,000
Commission Received in Advance 20,000 Sundry Debtors 2,00,000
Capital A/cs: Less: Provision for
A 7,00,000 Doubtful Debts 10,000 1,90,000
B 5,00,000 Stock 4,00,000
C 2,00,000 14,00,000 Furniture and Fixtures 40,000
Land and Buildings 6,00,000
Goodwill 30,000
Patents 20,000
Profit & Loss A/c 2,00,000
15,00,000 15,00,000
The firm was dissolved on the above date and the transactions were :
(i) A Creditor for ₹10,000 was untraceable and remaining Creditors accepted payment allowing 10% discount.
(ii) Sundry Debtors included a bad debt for ₹5,000 and the rest were realised at 20% discount.
(iii) Furniture and Fixtures realised ₹15,000.
(iv) Commission received in advance was returned to the customers less ₹4,000.
(v) Stock included obsolete items of ₹50,000 which realised at 10% and rest of the stock realised 60% of the
book value.
(vi) Realisation expenses were ₹7,000.
Prepare realisation account. (6)
10. Sita and Gita were partners sharing profits and losses in the ratio of 4:5. They dissolved their partnership on
31st March, 2021, when their Balance Sheet showed the following balances:
Particulars (₹)
Sita's Capital 30,000
Gita's Capital 35,000
Gita's Current A/c (Dr) 2,000
Contingency Reserve 18,000
P/L A/c (Dr) 4,500
On the date of dissolution:
(i) The firm, upon realisation of assets and settlement of liabilities, made a profit of ₹9,000.
(ii) Gita paid the realisation expenses of ₹2,000.
(i) Gita discharged the outstanding salary of the manager of the firm of ₹1,000 which was unrecorded in the
books.
You are required to prepare the Partners' Capital Accounts. (6)
ACCOUNTS BY VIJAY GOYAL, DSS-130, SEC-11, PKL & SCO-286, SEC-20, PKL, 9041672311, 8556888389
