Class 12 Commerce Accountancy - Dissolution Of Partnership Firm

Distinguish between 'Dissolution of partnership' and 'Dissolution firm' on the basis of court's intervention.

There is no intervention by the court. Dissolution of partnership firm may be done with the consent of the court.

What Journal entry is passed when an asset is given to any of the firm's creditors towards partial payment of dues?

Realisation A/C.............. Dr.

To Bank A/C

(Being the asset given to creditor towards partial payment of dues)

Note: For partial payment of dues, the amount that will be shown in the realisation account will be the amount remaining after taking over the asset, i.e, (amount due-value of the asset).

Distinguish between 'Dissolution of partnership' and 'Dissolution of partnership firm' on the basis of settlement of assets and liabilities.

Basis	Dissolution of Partnership	Dissolution of Firm
Termination of business	The business is not terminated	The business of the firm is closed
Closure of books	Does not require because business is terminated	The books of account are not closed.

What is meant by Dissolution?

Dissolution is an act or process of terminating an organisation or legal agreement officially.

In case of dissolution of firm which liabilities are to be paid first?

The proceeds from the sale of assets along with the contribution of the partners at the time of dissolution of the firm are first used up to pay off the external liabilities, i.e., the creditors, bank loans, bank overdrafts, bills payable etc.

Distinguish between 'Dissolution of Partnership' and 'Dissolution of Partnership Firm' on the basis of closure of books.

Dissolution of Partnership does not involve closure of books since only the relationship between the partners changes. The assets and liabilities are revalued since the business still continues to exist but in a changed form.

Whereas, Dissolution of Partnership Firm terminates the ongoing business of the firm. This involves selling off the assets and discharging off the liabilities and closing all the books of accounts.

Explain dissolution of a firm by (i) Agreement and (ii) Notice

(i) Dissolution by Agreement:-

It means that the firm is dissolved due to a mutual agreement between the partners. A firm may be dissolved if all the partners agree on it or if there is a clause for the dissolution in the partnership agreement drafted by the partners.

(ii) Dissolution by Notice:-

A partnership at will can be dissolved when a partner gives notice, in writing, to all the other partners about his/her intentions about the dissolution of the firm.

Record necessary Journal entries in the following cases:
(a) Creditors worth Rs. 85,000 accepted Rs. 40,000 as cash and investment worth Rs. 43,000, in full settlement of their claim.
(b) creditors were Rs. 16,They accepted Machinery valued at Rs. 18,000 in settlement of their claim.
(c) Creditors were Rs. 90,They accepted building valued at Rs. 1,20,000 and paid cash to the firm Rs. 30,000.

(a) Realisation A/C..... Dr. 40000

To Cash A/C 40000

(Being cash paid on partial settlement of creditors)

(b) No entry is passed since full settlement of creditors is made by taking over Machinery.

To Realisation A/C 30000

(Being cash received on partial settlement of creditors)

If a loan from a partner appears on the liabilities side of the Balance Sheet of the firm and the Capital Account of such partner shows a debit balance after all adjustment, how is loan dealt with?

If a partner from whom a loan has been taken by the firm shows a debit balance after all adjustments, his loan account will be transferred to the credit of his capital account to the extent of the debit balance of capital account and the balance shall be treated as liability and shall be paid as liability is paid.

Differentiate between 'Dissolution of Partnership' and 'Dissolution of Partnership Firm' on the basis of 'Continuity of Business'.

Dissolution of the partnership does not involve the termination of the continuity of the business. It only dissolves the current agreement between the partners and a new agreement is drafted.

Whereas, Dissolution of the partnership firm is an official termination of the firm which means that the continuing operations of the firm have ceased to exist.

A and B are partners in a firm sharing profits in the ration $3:2$ . Mrs. A has given a loan of Rs. 20,000 to the firm and the firm also obtained a loan of Rs. 10,000 from B. The firm was dissolved and its assets were realised for Rs.25,State the order of payment of Mrs. A's loan and B's loan with reason, if there were no creditors of the firm.

According to Section 48 of the Indian Partnership Act, 1932:-

The following order has to be followed for the discharge of liabilities:

1. Payment to loans provided by third parties;

2. Payment to loans and advances provided by the partners;

3. Payment of capitals of partners;

4. The residue will be divided among the partners in the profit-sharing ratio.

According to the above rules, Mrs. A, a third party, has to be paid off before B.

Hence, the amount paid to Mrs. A= Rs. 20000

amount paid to B= Rs. 5000.

Given any one difference between reconstitution of a firm and dissolution of firm.

Reconstitution of a firm refers to the change in the composition of the firm. It merely means changing the number or status of the partners and not the rights and duties of the partners.

Whereas, Dissolution of the firm means termination of the business of the firm. The rights and duties of the partners towards the firm cease to exist.

Distinguish between 'Dissolution of Partnership' and 'Dissolution of Partnership Firm' on the basis of Court's intervention.

The difference between the Dissolution of Partnership and Dissolution of Partnership Firm is as follows:

Basis of Difference	Dissolution of Partnership	Dissolution of Partnership Firm
Meaning	It means change in the partnership deed (or the agreement) among the partners.	It means that the business is wound up and the firm is dissolved.
Discontinuation of business	It does not affect the continuation of business.	It affects the business. Firm is closed in this case.
Assets and Liabilities	Assets and liabilities are revalued. New balance sheet is prepared.	Assets are sold and realized. Liabilities are paid off.
Intervention by court	There is no intervention by the court.	Court has inherent power to intervene. By its order, a firm can be dissolved.
Economic relationship	Economic relationship among partners may remain or change.	Economic relationship among partners comes to an end.
Closure of books of accounts	No need to close account boos, as the business continues to operate.	All books of account are closed.

Give any two objects of the partners share gain (profit) or loss on realisation of various assets and payment of various liabilities.

Following are the two objects of the partners share gain (profit) or loss on realisation of various assets and payment of various liabilities :

1. To know the actual amount payable to or received from any partner.
2. To avoid any disputes regarding distribution of cash available with the business.

$X,Y$ and $Z$ were partners sharing profits and losses in the ratio of $2:2:1$ respectively. Their Balance Sheet as on 31-03-2016 was as under.
Balance Sheet as on 31-3-2016
Liabilities Rs. Assets Rs.
Creditors 25,000 Cash at Bank 10,000
Bills Payable 10,000 Bills receivable 10,000
Reserves fund
20,000
Debtors 40,000
Less: PBD 2,000

38,000
Profit and loss A/c 3,000
Capitals:
X 50,000
Y 30,000
Z 20,000

1,00,000 Stock 20,000
Machinery
20,000
Furniture
10,000
Building
50,000

1,58,000
1,58,000
$Z$ retired on 1-4-2016 from the business. The following adjustment are to be made:
a) Stock to be increased by $20\%$
b) Maintain P.B.D. at $10\%$ on debtors.
c) Depreciate machinery and furniture by $10\%$ each,
d) Building to be revalued at Rs. 60,000
e) Goodwill of the firm is created Rs. 25,000 and written off immediately.

Prepare:
i) Revaluation A/c
ii) Partners capital A/c
iii) Balance Sheet as on 1-4-2016

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A and B dissolve their partnership. Their position as at 31st March, 2018 was:
Particulars Rs.
A's Capital 25,000
B's Capital 15,000
Sundry Creditors 20,000
Cash in Hand and at Bank 750
The balance of A's Loan Account to the firm stood at Rs. 10,The realisation expenses amounted to Rs.Stock realised Rs. 20,000 and Debtors Rs. 25,B took a machine at the agreed valuation of Rs. 7,Other fixed assets realised Rs. 20,
You are required to close the books of the firm.

Realisation Account

Particulars	Amount	Particulars	Amount
To Sundry Assets (working notes)	69250	By Sundry Creditors	20000
To Bank A/c Creditors- 20000 Expenses- 350	20350	By Bank A/c Stock- 20000 Debtors- 25000 Other Assets- 20000	65000
To Profit (transferred to partner's capital a/c) A- 1450 B- 1450	2900	By B's Capital A/c	7500
Total	92500	Total	92500

A's Loan Account

Particulars	Amount	Particulars	Amount
To Bank A/c	10000	By Balance b/d	10000
Total	10000	Total	10000

Partner's Capital Accounts

Particulars	A	B	Particulars	A	B
To Realisation A/c (machinery)		7500	By Balance b/d	25000	15000
To Bank A/c	26450	8950	By Realisation A/c (profits)	1450	1450
Total	26450	16450	Total	26450	16450

Bank Account

Particulars	Amount	Particulars	Amount
To Balance b/d	750	By Realisation A/c	20350
To Realisation A/c	65000	By A's Loan A/c	10000
		By A's Capital A/c	26450
		By B's Capital A/c	8950
Total	65750	Total	65750

Working Notes: 1 Memorandum Balance Sheet

Liabilities	Amount	Assets	Amount
Capital A- 25000 B- 15000	40000	Cash in Hand and at Bank	750
Sundry Creditors	20000	Sundry Assets (balancing figure)	69250
A's Loan	10000
Total	70000	Total	70000

Give the formula for calculation of new profit sharing ratio on retirement of a partner.

Gaining ratio = new ratio - existing ratio

For Example :-

Calculate the new profit sharing ratio of A and C. Gaining Ratio = New Ratio – Existing, Ratio Gain of A = 4/6 – 3/6 = 1/6 Gain of C = 2/6 – 1/6 = 1/6 1/6 : 1/6 1 : 1 i.e, equal.

The retiring partner's share is taken up by one of the remaining partners.

A firm Manufacturing Spices adultrate spices and sell at low price to various restaurants, hotels and shops. What values are being violated?

A firm Manufacturing Spices adulterate spices and sell at low price to various restaurants, hotels and shops. The values being violated are :-

1. Harming the health of people who consume dishes made with those spices.The health of the people might be affected adversely by the intake of adulterated spices.An adulterant is a chemical substance which should not be contained within other substances (e.g. food, beverages, and fuels) for legal or other reasons.

2. Violation of anti-adulteration law-The Government of India, therefore, enacted a Central Legislation called the Prevention of Food adulteration Act (PFA) in the year 1954 which came into effect from 15 June, 1955. The Act repealed all laws, existing at that time in States concerning food adulteration. In this Act unless the context otherwise requires -

“adulterant” means any material which is or could be employed for the purpose of adulteration;

“adulterated”—an article of food shall be deemed to be adulterated.

It has several criteria to be fulfilled for different food items including spices and those criteria have been violated.

3. Providing false information to buyer- The buyer is unaware about the nature, substance or quality of the product. The information on the packaging is not correct and this a punishable offence.

What is Realisation account ?

Realization Account is prepared at the time of dissolution of a partnership firm. This account is prepared to know the profit made or loss incurred at the time of dissolution of a firm. All the assets except cash and bank a/c are transferred to the debit side of realization account and liabilities (not capital accounts) are transferred to the credit side of realization account. When assets are sold cash/bank A/c is debited and Realization A/c credited. On settling the liabilities Realization A/c is debited and Cash/Bank A/c is credited. In last if total of credit side exceeds debit side, it means there is profit and that is transferred to partner's capital accounts. In case of loss, the partners' capital accounts are debited and Realization A/c credited.

State any two differences between dissolution of partnership and dissolution of partnership firm.

	Dissolution of Partnership	Dissolution of Firm
	Dissolution of a partnership – to the adjournment of the association between a partner and the rest of the partners of an enterprise	Dissolution of firm – that entire enterprise discontinues to exist, which includes the association among all the partners
	Voluntary	Compulsory or Voluntary

The partnership between A and B was dissolved on 31st March,On that date the respective credits to the capitals were A - Rs. 1,70,000 and B - Rs. 30,Rs. 20,000 were owed by B to the firm; $Rs.$ 1,00,000 were owed by the firm to A and Rs. 2,00,000 were due to the Trade Creditors. Profits and losses were shared in the proportions of 2/3 to A, 1/3 to B.
The assets represented by the above stated net liabilities realised Rs. 4,50,000 exclusive of Rs. 20,000 owed by B. The liabilities were settled at book figures. Prepare Realisation Account, Partners' Capital Accounts and Cash Account showing the distribution to the partners.

Realisation Account

Particulars	Amount	Particulars	Amount
To Sundry Assets A/c (Working Notes)	480000	By Trade Creditors	200000
To B's Loan	20000	By Cash A/c (assets realised)	450000
To Cash A/c (creditors paid)	200000	By B's Capital A/c (B's Loan)	20000
		By loss (transferred to partner's capital a/c A- 20000 B- 10000	30000
Total	700000	Total	700000

Capital A/c

Particulars	A	B	Particulars	A	B
To Realisation A/c (loan)		20000	By Balance b/d	170000	30000
To Realisation A/c (loss)	20000	10000
To Cash A/c	150000
Total	170000	30000	Total	170000	30000

Cash Account

Particulars	Amount	Particulars	Amount
To Realization A/c (Assets)	450000	By Realization A/c (Creditors)	200000
		By A's Capital A/c	150000
		By A's loan A/c	100000
Total	450000	Total	450000

Working Notes: 1 Memorandum Balance Sheet

Liabilities	Amount	Assets	Amount
Capital A- 170000 B- 30000	200000	B's Loan	20000
A's Loan	100000	Sundry Assets (balancing figure)	480000
Trade Creditors	200000
Total	500000	Total	500000

Distinguish between 'Dissolution of partnership ' and Dissolution of partnership Firm' on the basis of closure of books.

Given below is the different between dissolution of partnership and dissolution of a partnership firm on the basic of closure of books.

Basis of Difference	Dissolution of Partnership	Dissolution of Partnership Firm
Closure of Books	Books of accounts are not closed forever,as there is only change in the existing agreement between the partners.	Books of account are closed ,as they business is discontinued.

Pass the Journal entries, for the following transactions on the dissolution of the firm of P and Q after various assets (other than cash) and outside liabilities have been transferred to Realisation Account
(a) Stock Rs. 2,00,'P' took over 50% of stock at a discount of 10%. Remaining stock was sold at a profit of 25% on cost.
(b) Debtors Rs. 2,25,Provision for Doubtful Debts Rs. 25,Rs. 20,000 of the book debts proved bad.
(c) Land and Building (Book value Rs. 12,50,000) sold for Rs. 15,00,000 through a broker who charged 2% commission.
(d) Machinery (Book value Rs. 6,00,000) was handed over to a creditor at a discount of 10%
(e) Investment (Book value Rs. 60,000) ranted at 125%.
(f) Goodwill of Rs. 75,000 and prepaid fire insurance of 10,000.
(g) There was an old furniture in the firm which had been written off completely in the books. This was sold for Rs. 10,000.
(h) 'Z' an old customer whose account for Rs. 20,000 was written off as bad in the previous year, paid 60%.
(i) 'P' undertook to pay Mrs. P's loan of Rs. 50,000.
(j) Trade creditors Rs. 1,60,Half of the trade cretlitors accepted Plant and Machlnery at an agreed valuation of Rs. 54,000 and cash in full settlement of their claims after allowing a discount of Rs. 16,000.
Remaining trade creditors were paid 90% in final settlement

(a) P's Capital A/C..... Dr. 90000

Bank A/C.... Dr. 125000

To Realisation A/C 215000

(Being stock taken over by P and rest sold off)

(b)(i) Bank A/C..... Dr. 205000

To Realisation A/C 205000

(Being debtors realised)

To Realisation A/C 1470000

(Being land and building sold after charging 2% commission on sale)

(d) No entry will be passed as no bank or cash is involved.

(e) Bank A/C..... Dr. 75000

To Realisation A/C 75000

(Being investments realised at 125%)

(f) No entry will be passed for goodwill as well as prepaid fire insurance as it has not realised any amount.

(g) Bank A/C..... Dr. 10000

To Realisation A/C 10000

(Being unrecorded asset realised)

(h) Bank A/C.... Dr. 12000

To Realisation A/C 12000

(Being bad debt recovered @ 60%)

(i) Realisation A/C.... Dr. 50000

To P's Capital A/C 50000

(Being Mrs. P's loan discharged by Mr. P)

(j) (1) Realisation A/C.... Dr. 10000

To Bank A/C 10000

(Being creditors paid in cash after discount of Rs. 16000)

(2) Realisation A/C..... Dr. 72000

To Bank A/C 72000

(Being creditors paid 90%)

Pass neceisaly Journal. entries on the dissolution of a firm in the fondling cases:
(a) Dharam, a partner, was appointed to Iook after the process of dissolution at a remuneration of Rs. 12,000 and he had to bear the dissolution expenses. Dissolution expenses Rs. 11,000 were paid by Dharam.
(b) Jay, a partner, was appointed to look after the process of dissolution and was allowed a remuneration of Rs. 15,Jay agreed to bear dissolution expenses Rs. 16,000 were paid by Vijay another partner on behalf of Jay.
(c) Deepa, a partner, was to look after the process of dissolution and for this work she was allowed a remuneration of Rs. 7,deepa agreed to bear dissolution expenses. Actual dissolution expenses Rs. 6,000 were paid from the firm's bank account.
(d) Dev, a partner, agreed to do the work of dissolution for Rs. 7,He took away stock of the same amount as his commission. The stock had already been transferred to realisation Account.
(e) Jeev, a partner, agreed to do the work of dissolution for which he was allowed a commission of Rs. 10,He agreed to dissolution expenses. Actual dissolution expenses paid by Jeev were Rs. 12,These expenses were paid by Jeev by drawing cash from the firm.
(f) A debtor of Rs. 8,000 already transferred to Realisation Account agreed to pay the realisation expenses of Rs. 7,800 in full Settlement of his account.

(a) Realisation A/C..... Dr. 12000

To Dharam's Capital A/C 12000

(Being dissolution expenses borne by Dharam)

(b) (i) Realisation A/C..... Dr. 15000

To Jay's Capital A/C 15000

(Being remuneration allowed to Jay)

(ii) Jay's Capital A/C..... Dr. 16000

To Vijay's Capital A/C 16000

(Being Vijay paid on behalf of Jay)

To Deepa's capital A/C 7000

(Being remuneration allowed to Deepa)

(ii) Deepa's Capital A/C.... Dr. 6000

To Bank A/C 6000

(Being dissolution expenses paid by the firm on behalf of Deepa)

(d) (i) Realisation A/C..... Dr. 7500

To Dev's Capital A/C 7500

(Being commission provided to Dev for dissolution)

(e) (i) Realisation A/C..... Dr. 10000

To Jeev's Capital A/C 10000

(Being commission allowed to Jeev for dissolution)

(ii) Jeev's Capital A/C..... Dr. 12000

To Bank A/C 12000

(Being dissolution expenses paid by firm on behalf of Jeev)

(f) No Entry is to be passed since debtor pays in full settlement of his account.

Rekha and Chetana sharing profits as $3:1$ and they agree upon dissolution. The balance sheet as on 31 March, 2018 is as under :
Balance sheet of Rekha and Chetana as on $31 \ March , \ 2018$
Liabilities
Rs. Assets Rs.
Loan
Creditors
Capital :
Rekha
Chetana

$22,000$
$13,600$ $2,400$
$3,600$

$35,600$ Cash at Bank
Stock
Furniture
Debtors
Plant and Machinery $5,000$
$9,000$
$3,200$
$14,000$
$10,400$
$41,600$ $41,600$
Additional information :
a) Rekha took over plant and Machinery at an agreed value of $Rs.12,000$
b) Stock and furniture were sold for $Rs.8,400$ and $Rs.2,780$ respectively
c) Debtors were took over by Chetana at $Rs.13,000$
d) Liabilities were paid in full by the firm
e) Realisation expenses were $Rs.320$ .
Prepare :
1) Realisation account
2) Partners capital accounts and
3) Bank account.

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Raju and Ravi are partners sharing profits and losses in the ratio of $3:2$ . Their Balance Sheet as on 31-3-2016 was as follows:
Balance Sheet as on 31-3-2016
Liabilities Rs. Assets Rs.
Creditors 20,000 Cash at hand 5,000
Bills Payable 10,000 Bills receivable 15,000
Bank loan A/c 15,000 Debtors 20,000
Raju's loan A/c 5,000 Motor car 10,000
General Reserves 10,000 Machinery 30,000
Capitals:
Raju 50,000
Ravi 40,000

90,000 Furniture 15,000
Buildings
50,000
Profit and loss A/c
5,000

1,50,000
1,50,000
On the above date the firm was dissolved. The assets realised as follows:
a) Buildings Rs. 60,000, Machinery Rs. 28,000, Bills Recivable Rs. 14,Debtors Rs. 19,000 and unrecorded assets realised Rs. 20,000.
b) Motor car is taken over by Raju at book value.
c) Furniture is taken over by Ravi for Rs. 13,000.
d) Creditors and Bills payable were paid off at a discount of $5\%$ and Bank loan paid in full.
e) Dissolution expenses Rs. 2,000.

Prepare:
i) Realisation A/c
ii) Partners capital A/c
iii) Cash A/c

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Ashwin, Bhavin and Pravin carried on business. They share profits and losses in the ratio of $5:3:2$ respectively. Their Balance Sheet as on $31^{st}$ March, $2016$ was as under:
Balance Sheet as on $31^{st}$ March, $2016$
Liabilities Amount (Rs.) Assets Amount(Rs.)
Sundry creditors $42,000$ Plant and machinery $40,000$
Bhavin's loan $10,000$ Investment $16,000$
Reserve fund $40,000$ Stock $60,000$
Capital accounts:
Debtors $36,000$
Ashwin $40,000$ Less: R.D.D. $2,000$ $34,000$
Bhavin $20,000$ Bank $10,000$
Pravin $8,000$
$1,60,000$ $1,60,000$
Of the given data, the firm was dissolved, and the assets realised were as under:
$(1)$ Investment Rs. $10,000$ , Stock Rs. $48,000$ , and Debtors Rs. $30,000$
$(2)$ Plant and machinery were taken over by Ashwin at book value.
$(3)$ Sundry creditors and Bhavin's loan were paid in full.
$(4)$ Realisation expenses incurred Rs. $2,000$ .
Prepare:
$(1)$ Realisation Account
$(2)$ Partner's Capital Account
$(3)$ Bank Account

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Dissolution Of Partnership Firm - Class 12 Commerce Accountancy - Extra Questions

Distinguish between 'Dissolution of partnership' and 'Dissolution firm' on the basis of court's intervention.

What Journal entry is passed when an asset is given to any of the firm's creditors towards partial payment of dues?

Distinguish between 'Dissolution of partnership' and 'Dissolution of partnership firm' on the basis of settlement of assets and liabilities.

What is meant by Dissolution?

In case of dissolution of firm which liabilities are to be paid first?

Distinguish between 'Dissolution of Partnership' and 'Dissolution of Partnership Firm' on the basis of closure of books.

Explain dissolution of a firm by (i) Agreement and (ii) Notice

If a loan from a partner appears on the liabilities side of the Balance Sheet of the firm and the Capital Account of such partner shows a debit balance after all adjustment, how is loan dealt with?

Differentiate between 'Dissolution of Partnership' and 'Dissolution of Partnership Firm' on the basis of 'Continuity of Business'.

Given any one difference between reconstitution of a firm and dissolution of firm.

Distinguish between 'Dissolution of Partnership' and 'Dissolution of Partnership Firm' on the basis of Court's intervention.

Give any two objects of the partners share gain (profit) or loss on realisation of various assets and payment of various liabilities.

Give the formula for calculation of new profit sharing ratio on retirement of a partner.

A firm Manufacturing Spices adultrate spices and sell at low price to various restaurants, hotels and shops. What values are being violated?

What is Realisation account ?

State any two differences between dissolution of partnership and dissolution of partnership firm.

Distinguish between 'Dissolution of partnership ' and Dissolution of partnership Firm' on the basis of closure of books.

Class 12 Commerce Accountancy Extra Questions

Liabilities	Rs.	Assets	Rs.
Creditors	25,000	Cash at Bank	10,000
Bills Payable	10,000	Bills receivable	10,000
Reserves fund	20,000	Debtors 40,000 Less: PBD 2,000	38,000
Profit and loss A/c	3,000	Debtors 40,000 Less: PBD 2,000	38,000
Capitals: X 50,000 Y 30,000 Z 20,000	1,00,000	Stock	20,000
		Machinery	20,000
		Furniture	10,000
		Building	50,000
	1,58,000		1,58,000

Particulars	Rs.
A's Capital	25,000
B's Capital	15,000
Sundry Creditors	20,000
Cash in Hand and at Bank	750

Liabilities		Rs.	Assets	Rs.
Loan Creditors Capital : Rekha Chetana	$22,000$ $13,600$	$2,400$ $3,600$ $35,600$	Cash at Bank Stock Furniture Debtors Plant and Machinery	$5,000$ $9,000$ $3,200$ $14,000$ $10,400$
		$41,600$		$41,600$

Liabilities	Amount (Rs.)	Assets	Amount(Rs.)
Sundry creditors	$42,000$	Plant and machinery	$40,000$
Bhavin's loan	$10,000$	Investment	$16,000$
Reserve fund	$40,000$	Stock	$60,000$
Capital accounts:		Debtors $36,000$
Ashwin	$40,000$	Less: R.D.D. $2,000$	$34,000$
Bhavin	$20,000$	Bank	$10,000$
Pravin	$8,000$
	$1,60,000$		$1,60,000$

Dissolution Of Partnership Firm - Class 12 Commerce Accountancy - Extra Questions

Distinguish between 'Dissolution of partnership' and 'Dissolution firm' on the basis of court's intervention.

What Journal entry is passed when an asset is given to any of the firm's creditors towards partial payment of dues?

Distinguish between 'Dissolution of partnership' and 'Dissolution of partnership firm' on the basis of settlement of assets and liabilities.

What is meant by Dissolution?

In case of dissolution of firm which liabilities are to be paid first?

Distinguish between 'Dissolution of Partnership' and 'Dissolution of Partnership Firm' on the basis of closure of books.

Explain dissolution of a firm by (i) Agreement and (ii) Notice

If a loan from a partner appears on the liabilities side of the Balance Sheet of the firm and the Capital Account of such partner shows a debit balance after all adjustment, how is loan dealt with?

Differentiate between 'Dissolution of Partnership' and 'Dissolution of Partnership Firm' on the basis of 'Continuity of Business'.

Given any one difference between reconstitution of a firm and dissolution of firm.

Distinguish between 'Dissolution of Partnership' and 'Dissolution of Partnership Firm' on the basis of Court's intervention.

Give any two objects of the partners share gain (profit) or loss on realisation of various assets and payment of various liabilities.

Give the formula for calculation of new profit sharing ratio on retirement of a partner.

A firm Manufacturing Spices adultrate spices and sell at low price to various restaurants, hotels and shops. What values are being violated?

What is Realisation account ?

State any two differences between dissolution of partnership and dissolution of partnership firm.

Distinguish between 'Dissolution of partnership ' and Dissolution of partnership Firm' on the basis of closure of books.

Class 12 Commerce Accountancy Extra Questions

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