Dissolution Of Partnership Firm
12 previous year questions.
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Chapter Questions 12 MCQs
On Sonu’s retirement, the Goodwill of the firm was valued at Rs.1,40,000.
The new profit-sharing ratio among Ravi, Guru, and Mani was 5 : 5 : 1.
Showing your workings clearly, pass the necessary Journal entry for the treatment of Goodwill in the books of the firm on Sonu’s retirement without opening the goodwill account.
Rishika and Shivika were partners in a firm sharing profits and losses in the ratio of 3 : 2. Their Balance Sheet as at 31st March, 2024 stood as follows:
Balance Sheet of Rishika and Shivika as at 31st March, 2024
| Liabilities | Amount (₹) | Assets | Amount (₹) |
|---|---|---|---|
| Capitals: | Equipment | 45,00,000 | |
| Rishika – ₹30,00,000 Shivika – ₹20,00,000 | 50,00,000 | Investments | 5,00,000 |
| Shivika’s Husband’s Loan | 5,00,000 | Debtors | 35,00,000 |
| Creditors | 40,00,000 | Stock | 8,00,000 |
| Cash at Bank | 2,00,000 | ||
| Total | 95,00,000 | Total | 95,00,000 |
The firm was dissolved on the above date and the following transactions took place:
(i) Equipements were given to creditors in full settlement of their account.
(ii) Investments were sold at a profit of 20% on its book value.
(iii) Full amount was collected from debtors.
(iv) Stock was taken over by Rishika at 50% discount.
(v) Actual expenses of realisation amounted to ₹ 2,00,000 which were paid by the firm. Prepare Realisation Account.
Manav and Namit were partners in a firm sharing profits and losses in the ratio of 3 : 2. Their Balance Sheet as at 31st March 2024 was as follows:
| Liabilities | Assets | ||
|---|---|---|---|
| Capitals: | Machinery | ₹8,00,000 | |
| Manav | ₹4,00,000 | Investments | ₹5,00,000 |
| Namit | ₹6,00,000 | Debtors | ₹12,00,000 |
| Bank Overdraft | ₹9,00,000 | Stock | ₹3,00,000 |
| Creditors | ₹10,00,000 | Cash in Hand | ₹1,00,000 |
| Total | ₹29,00,000 | Total | ₹29,00,000 |
The firm was dissolved on the above date and the following transactions took place:
[(i)] Stock was given to creditors in full settlement of their account.
[(ii)] Investments were taken over by Manav at 120% of book value.
[(iii)] Bad debts amounted to ₹ 2,00,000.
[(iv)] Machinery was realised at 50% discount.
[(v)] Realisation expenses amounted to ₹ 1,00,000 which were paid by Namit.
Prepare Realisation Account.
(i) Land and Building was sold for ₹ 20,00,000.
(ii) Plant and Machinery realised ₹ 40,000 less than their book value and furniture was taken over by the creditors in full settlement of their account.
(iii) Debtors and Bills Receivable realised ₹ 90,000.
(iv) 60% of the stock was taken over by Raja at 90% of the book value and the remaining stock realised at ₹ 44,000.
(v) Outstanding wages were paid in full.
(vi) Mrs. Raja's loan was paid with interest of ₹ 10,000.
(vii) Realisation expenses were ₹ 8,000. Prepare Realisation Account.
Which of the following will not result in compulsory dissolution of a partnership firm?
Dev, Bhudev and Shamdev were partners in a firm sharing profits equally. On 31st March, 2024, their firm was dissolved. On this date the bank account showed a credit balance of 10,000 and there was a debit balance of 15,000 in the cash account. All payments were settled by cheque. Ravi, a creditor of 2,000 was not having any bank account, therefore he was paid in cash. Afterwards the cash account was closed by depositing the balance of cash into the bank. The journal entry for closing cash account will be:
Sandhya and Suman were partners in a firm sharing profits and losses in the ratio of 3 : 5. They decided to dissolve the firm on 31st March, 2024. On the date of dissolution, the Balance Sheet of the firm showed a balance of 80,000 in sundry debtors and a balance of 5,000 in provision for bad debts account. How much amount will be transferred to Realisation Account to close Sundry Debtors Account?
- [(i)] Preeti took over the debtors of book value of ₹ 90,000 at a discount of 20%.
- [(ii)] Kamala took over her husband’s loan of ₹ 4,00,000.
- [(iii)] There were 100 shares of ₹ 10 each in Star Ltd. acquired at a cost of ₹ 2,00,000 which had been written off completely from the books. These shares were valued at ₹ 2,400 each and divided among the partners in their profit sharing ratio.
- [(iv)] Sundry creditors amounting to ₹ 5,00,000 were settled at a discount of 10%.
- [(v)] Land and Building of the book value of ₹ 40,00,000 was sold for ₹ 60,00,000 through a broker who charged 5% commission.
- [(vi)] Varsha paid the dissolution expenses of ₹ 45,000 on behalf of the firm.