Balance Sheet of Ashish and Kanav as at 31st March, 2018
Liabilities | Amount (Rs.) | Assets | Amount (Rs.) |
| Trade Creditors Employee’s Provident Fund Mrs. Ashish’s Loan Kanav’s Loan Workmen’s compensation Fund Investment Fluctuation Reserve Capital: Ashish 1,20,000 Kanav 80,000 | 42,000 60,000 9,000 35,000 20,000 4,000 2,00,000 | Bank Stock Debtors Furniture Plant Investments Profit and Loss Account | 35,000 24,000 19,000 40,000 2,10,000 32,000 10,000 |
| 3,70,000 | 3,70,000 |
On the above date they decided to dissolve the firm.
(i) Ashish agreed to take over furniture at 38,000 and pay off Mrs. Ashish’s loan.
(ii) Debtors realised 18,500 and plant realised 10% more.
(iii) Kanav took over 40% of the stock at 20% less than the book value. Remaining stock was sold at a gain of 10%.
(iv) Trade creditors took over investments in full settlement.
(v) Kanav agreed to take over the responsibility of completing dissolution at an agreed remuneration of Rs. 12,000 and to bear realization expenses. Actual expenses of realization amounted to Rs. 8,000. Prepare Revaluation Account.
Solution
