Question

23. Rishan, Suzane, and Tapti were partners in a firm sharing profits and losses equally. On 31\textsuperscript{st March, 2023 their Balance Sheet was as follows:} \[ \begin{array}{|l|c|c|} \hline Liabilities & Amount (₹) & Assets & Amount (₹)
\hline \text{Creditors} & 60,000 & \text{Cash at Bank} & 25,000
\text{General Reserve} & 60,000 & \text{Debtors} & 40,000
\text{Capital:} & & \text{Stock} & 60,000
\text{Rishan} & 1,25,000 & \text{Investments} & 80,000
\text{Suzane} & 1,05,000 & \text{Plant and Equipment} & 2,00,000
\text{Tapti} & 55,000 & &
\hline \text{Total} & 4,05,000 & \text{Total} & 4,05,000
\hline \end{array} \] On the above date, the firm was dissolved on the following terms: Plant and Equipment were realised at 10\% less than the book value. Debtors were realised at book value. Investments were taken over by Suzane at ₹ 1,00,000. Tapti took over 50\% of the stock at ₹ 36,000. The remaining stock was sold for ₹ 19,000. Expenses of realisation amounted to ₹ 20,000 which were paid by Rishan. Prepare Realisation Account.

Hint:

When preparing the Realisation Account, account for all assets and liabilities. Ensure to apply the terms of dissolution for the realisation of assets and liabilities.

Answer 1

\[ \text{Realisation Account:} \] \[ \begin{array}{|l|c|c|} \hline Particulars & Dr Amount (₹) & Cr Amount (₹)
\hline \text{Plant and Equipment} & 2,00,000 &
\text{To Realised Amount} & & 1,80,000
\text{Debtors} & 40,000 &
\text{To Suzane’s Capital A/c} & & 1,00,000
\text{Stock} & 60,000 &
\text{To Tapti’s Capital A/c} & & 36,000
\hline \end{array} \]