| Liabilities | Amount (Rs.) | Assets | Amount (Rs.) |
| Creditors | 50,000 | Cash | 60,000 |
| Bank Loan | 35,000 | Debtors | 75,000 |
| Employees’ Provident Fund | 15,000 | Stock | 40,000 |
| Investments Fluctuation Reserve | 10,000 | Investments | 20,000 |
| Commission Received in Advance | 8,000 | Plant | 50,000 |
| Capital A/c : | Profit and Loss A/c | 3,000 | |
| Anju 50,000 | |||
| Manju 50,000 | |||
| Sanju 30,000 | 1,30,000 | ||
| 2,48,000 | 2,48,000 |
On this date, the firm was dissolved. Anju was appointed to realise the assets. Anju was to receive 5% commission on the sale of assets (except cash) and was to bear all expenses of realisation.
Anju realised the assets as follows: Debtors Rs. 60,000; Stock Rs. 35,500; Investments Rs. 16,000; Plant 90% of the book value. Expenses of Realisation amounted to Rs. 7,500. Commission received in advance was returned to customer after deducting Rs. 3,000.
Firm had to pay Rs. 8,500 for Outstanding Salary, not provided for earlier, Compensation paid to employees amounted to Rs. 17,000. This liability was not provided for in the above Balance Sheet. Rs. 20,000 had to be paid for Employees’ Provident Fund.
Prepare Realisation Account, Capital Accounts of Partners and Cash Account.
Solution
