Question 1:
X and Y are partners in a firm sharing profits in the ratio of 3:2. Mrs. X has given loan of ₹5,00,000 to the firm and the firm also took loan of ₹2,50,000 from Y. The firm was dissolved and its assets were realised for ₹6,25,000. State the order of payment of Mrs, X's loan and Y's loan with reason, if there were no other creditors of the firm.
Answer:
First Mrs X's loan of ₹5.00.000 being external Liability then ₹1,25,000 for Y's loan as per Section 48
Question 2:
Ajay and Vijay were partners sharing profits and losses in the ratio of 3:2. The firm was dissolved on 31st March, 2026 and the following balances were appearing in the books of the firm:
(a) Ajay's Loan- ₹2,00,000; Om's Loan- ₹1,25,000.
(b) Creditors ₹2,50,000.
(c) Capital balances after all adjustments - Ajay: ₹4,00,000 and Vijay: ₹3,50,000; Assets of the firm realized ₹15,00,000.
You are required to show the amounts and order of payment as per Section 48 of Indian Partnership Act, 1932 on dissolution of the firm.
Answer:
First: ₹2,50,000 paid to Creditors and ₹1,25,000 paid to Om respectively
Second: ₹2,00,000 paid to Ajay for his loan
Third: Capital balances of Ajay and Vijay: ₹4,00,000 and ₹3,50,000 paid to partners along with surplus of ₹1,75,000 (₹15,00,000-₹2,50,000-₹1,25,000-₹2,00,000 - ₹4,00,000-₹3,50,000) in their profit-sharing ratio, i.e., 3:2 as ₹1,05,000 and ₹75,000.
Question 3:
What Journal entry will be passed when the unrecorded furniture of ₹20,000 is taken by X, a partner at ₹15,000 on the dissolution of the firm?
Answer:
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In the books of the firm Journal |
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Date |
Particulars |
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L.F. |
Debit (₹) |
Credit (₹) |
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On the |
X’s Capital A/c |
Dr. |
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15,000 |
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Date of |
To Realisation A/c |
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15,000 |
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Dissolution |
(Being unrecorded furniture of ₹20,000 is taken by X, a partner at ₹15,000) |
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Question 4:
Land and Building (book value) ₹ 1,60,000 sold for ₹ 3,00,000 through a broker who charged 2% commission on the deal. Journalise the transaction, at the time of dissolution of the firm.
Answer:
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In the books of the firm Journal |
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Date |
Particulars |
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L.F. |
Debit (₹) |
Credit (₹) |
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On the |
Cash/ Bank A/c (3,00,000 – 6,000) |
Dr. |
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2,94,000 |
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Date of |
To Realisation A/c (3,00,000 – 6,000) |
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2,94,000 |
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Dissolution |
(Being amount realized from land and building after providing for 2% commission to the broker) |
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Question 5:
(a) What Journal entry will be passed when an unrecorded liability of ₹ 15,000 is settled at ₹ 10,000 and paid by X, a partner on the dissolution of a firm?
(b) What Journal entry will be passed when a machine having a book value off ₹ 15,000 is given to Rakesh, a creditor of ₹ 22,000 at an agreed valuation of ₹ 12,000 towards partial payment of his dues?
Answer:
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Date |
Particulars |
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₹ (Dr.) |
₹ (Cr.) |
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(a) |
Realisation A/c |
Dr. |
10,000 |
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To X's Capital A/c |
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10,000 |
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(Being an unrecorded liability of ₹15,000 settled at ₹10,000 and paid by partner X) |
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(b) |
Realisation A/c |
Dr. |
10,000 |
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To Cash/Bank A/c |
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10,000 |
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(Being the remaining balance of ₹10,000 paid to creditor Rakesh in cash) |
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Ts Grewal Solution 2026-2027
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Class 12 / Volume – I