CBSE Class 12

TS Grewal Accountancy Class 12 Solutions Chapter 6 Dissolution of Partnership Firm are part of TS Grewal Accountancy Class 12 Solutions. Here we have given TS Grewal Accountancy Class 12 Solutions Chapter 6 Dissolution of Partnership Firm.

TS Grewal Accountancy Class 12 Solutions Chapter 6 Dissolution of Partnership Firm

Question 1.
What journal entries would you pass in the following cases?
(a) Expenses of realisation ₹ 1,500.
(b) Expenses of realisation ₹ 600 but paid by Mohan, a partner.
(c) Mohan, one of the partners of the firm was asked to look into the dissolution of the firm for which he was allowed a commission of ₹ 2,000.
(d) Motor car of book value ₹ 50,000 taken over by creditors of the book value of ₹ 40,000 in full settlement.
Solution:

Question 2.
Pass journal entries for the following:
(a) Realisation expenses of ₹ 15,000 were to be met by Rahul, a partner but were paid by the firm.
(b) Ramesh, a partner was paid remuneration of ₹ 25,000 and he was to meet all expenses.
(c) Anuj, a partner, was paid remuneration of ₹ 20,000 and he was to meet all expenses. Firm paid an expense of ₹ 5,000.
Solution:

Question 3.
Pass journal entries for the following:
(a) Realisation expenses amounted to ₹ 10,000 were paid by the firm on behalf of Alok, a partner, with whom it was agreed at ₹ 7,500.
(b) Realisation expenses amounted to ₹ 5,000. It was agreed that the firm will pay ₹ 2,000 and balance by Ravinder, a partner.
(c) Dissolution expenses amounted to ₹ 10,000 were paid by Amit, a partner, on behalf of the firm.
Solution:

Question 4.
Record necessary journal entries in the following cases:
(a) Creditors worth ₹ 85,000 accepted ₹ 40,000 as cash and Investment worth ₹ 43,000, in full settlement of their claim.
(b) Creditors were ₹ 16,000. They accepted Machinery valued at ₹ 18,000 in settlement of their claim.
(c) Creditors were ₹ 90,000. They accepted Building valued at ₹ 1,20,000 and paid cash to the firm ₹ 30,000.
Solution:

Question 5.
Pass journal entries for the following at the time of dissolution of a firm:
(a) Sale of Assets – ₹ 50,000.
(b) Payment of Liabilities – ₹ 10,000.
(c) A commission of 5% allowed to Mr. X, a partner, on sale of assets.
(d) Realisation expenses amounted to ₹ 15,000. The firm had agreed with Amrit, a partner to reimburse him up to ₹ 10,000.
(e) Z, an old customer whose account for ₹ 6,000 was writte off as bad in the previous year paid 60% of the amount written off.
(f) Investment (Book Value ₹ 10,000) realised at 150%.
Solution:

Question 6.
Pass journal entries for the following transactions at the time of dissolution of the firm:
(a) Loan of ₹ 10,000 advanced by a partner to the firm was refunded.
(b) X, a partner, takes over an unrecorded asset (Typewriter) at ₹ 300.
(c) Undistributed balance (Debit) of Profit and Loss Account ₹ 30,000. The firm has three partners X, Y and Z.
(d) Assets of the firm realised ₹ 1,25,000.
(e) Y who undertakes to carry out the dissolution proceedings is paid ₹ 2,000 for the same Y.
(f) Creditors are paid ₹ 28,000 in full settlement of their account of ₹ 30,000.
Solution:

Question 7.
Pass necessary journal entries for the following transactions on the dissolution of the firm P and Q after the various assets (other than cash) and outside liabilities have been transferred to Realisation Account:
(a) Bank Loan ₹ 12,000 was paid.
(b) Stock worth ₹ 16,000 was taken over by partner Q.
(c) Partner P paid a creditor ₹ 4,000.
(d) An asset not appearing in the books of accounts realised ₹ 1,200.
(e) Expenses of realisation ₹ 2,000 were paid by partner Q.
(f) Profit on realisation ₹ 36,000 was distributed between P and Q in 5 : 4 ratio.
Solution:

Question 8.
X, Y and Z are partners in a firm sharing profits in the ratio of 3 : 2 : 1 respectively. The firm was dissolved on 1st March, 2013. After transferring assets (other than cash) and third party liabilities to the Realisation Account you are provided with the following information:
(a) There was a balance of ₹ 18,000 in the firm’s Profit and Loss Account.
(b) There was an unrecorded bike of ₹ 50,000 which was taken over by X.
(c) Creditors of ₹ 5,000 were paid ₹ 4,000 in full settlement of accounts.
Pass necessary journal entries for the above at the time of dissolution of firm.
Solution:

Question 9.
Pass necessary journal entries to record the following unrecorded assets and liabilities in the books of Paras and Priya:
(a) There was an old furniture in the firm which had been written off completely in the books. This was sold for ₹ 3,000.
(b) Ashish, an old customer whose account for ₹ 1,000 was written off as bad in the previous year paid 60% of the amount.
(c) Paras agreed to takeover the firm’s goodwill (not recorded in the books of the firm) at a valuation of ₹ 30,000.
(d) There was an old typewriter which had been written off completely from the books. It was estimated to realise ₹ 400. It was taken by Priya at an estimated price less 25%.
(e) There were 100 shares of ₹ 10 each in Star Limited acquired at a cost of ₹ 2,000 which had been written-off completely from the books. These shares are valued @ ₹ 6 each and divided among the partners in their profit-sharing ratio.
Solution:

Question 10.
Aman and Harsh were partners in a firm. They decided to dissolve their firm. Pass necessary journal entries for the following after various assets (other than cash and bank) and third party liabilities have been transferred to Realisation Account:
(a) There was furniture worth ₹ 50,000. Aman took over 50% of the furniture at 10% discount and the remaining furniture was sold at 30% profit on book value.
(b) Profit and Loss Account was showing a credit balance of ₹ 15,000 on the date of dissolution.
(c) Harsh’s loan of ₹ 6,000 was discharged at ₹ 6,200.
(d) The firm paid realisation expenses amounting to ₹ 5,000 on behalf of Harsh who had to bear these expenses.
(e) There was a bill for 1,200 under discount. The bill was received from Soham who proved insolvent and a first and final dividend of 25% was received from his estate.
(f) Creditors, to whom the firm owed ₹ 6,000, accepted stock of ₹ 5,000 at a discount of 5% and the balance in cash.
Solution:

Question 11.
Rohit, Kunal and Sarthak are partners in a firm. They decided to dissolve their firm. Pass necessary journal entries for the following after various assets (other than Cash and Bank) and the third party liability have been transferred to Realisation Account :
(a) Kunal agreed to pay off his wife’s loan of ₹ 6,000.
(b) Total Creditors of the firm were ₹ 40,000. Creditors worth ₹ 10,000 were given a piece of furniture costing ₹ 8,000 in full and final settlement. Remaining Creditors allowed a discount of 10%.
(c) Rohit had given a loan of ₹ 70,000 to the firm which was duly paid.
(d) A machine which was not recorded in the books was taken over by Kunal at ₹ 3,000, whereas its expected value was ₹ 5,000.
(e) The firm had a debit balance of ₹ 15,000 in the Profit and Loss Account on the date of dissolution.
(f) Sarthak paid the realisation expenses of ₹ 16,000 out of his private funds, who was to get a remuneration of ₹ 15,000 for completing dissolution process and was responsible to bear all the realisation expenses.
Solution:

Question 12.
Book value of assets ( other than cash and bank) transferred to Realisation Account is ₹ 1,00,000. 50% of the assets are taken over by a partner Atul, at a discount of 20%; 40% of the remaining assets are sold at a profit of 30% on cost 5% of the balance being obsolete realised nothing and remaining assets are handed over to a Creditor in full settlement of his claim.
You are required to record the journal entries for realisation of assets.
Solution:

Question 13.
Lal and Pal were partners in a firm sharing profits in the ratio of 3 : 7. On 1st April, 2015 their firm was dissolved. After transferring assets (other than cash and outsider’s liabilities to Realisation Account, you are given the following information :
(a) A creditor of ₹ 3,60,000 accepted machinery valued at ₹ 5,00,000 and paid to the firm ₹ 1,40,000.
(b) A second creditor for ₹ 50,000 accepted stock ₹ 45,000 in full settlement of his claim.
(c) A third creditor amounting to ₹ 90,000 accepted ₹ 45,000 in cash and investments worth ₹ 43,000 in full settlement of his claim.
(d) Loss on dissolution was ₹ 15,000.
Pass necessary journal entries for the above transactions in the books of firm assuming that all payments were made by cheque.
Solution:

Question 14.
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 ₹ 2,00,000. P took over 50% of stock at a discount of 10%. Remaining stock was sold at a profit of 25% on cost.
(b) Debtors ₹ 2,25,000. Provision for Doubtful Debts ₹ 25,000; ₹ 20,000 of the book debts proved bad.
(c) Land and Building (Book value ₹ 12,50,000) sold for ₹ 15,00,000 through a broker who changed 2% commission.
(d) Machinery (Book value ₹ 6,00,000) was handed over to a creditor at a discount of 10%.
(e) Investment (Book value ₹ 60,000) realised at 125%.
(f) Goodwill of ₹ 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 ₹ 10,000.
(h) Z an old customer whose account for ₹ 20,000 was written off as bad in the previous year paid 60%.
(i) P undertook to pay Mrs. P’s loan of ₹ 50,000.
(j) Trade creditors ₹ 1,60,000. Half of the trade creditors accepted Plant and Machinery at an agreed valuation of ₹ 54,000 and cash in full settlement of their claims after allowing a discount of ₹ 16,000.
Remaining trade creditors were paid 90% in final settlement.
Solution:

Question 15.
What journal entries would be passed for discharge of following unrecorded liabilities on the dissolution of a firm of partners A and B:
(a) There was a contingent liability in respect of bills discounted but not matured of ₹ 18,500. An acceptor of one bill of ₹ 2,500 became insolvent and fifty paise in a rupee was recovered. The liability of the firm on account of this bill discounted and dishonoured has not so far been recorded.
(b) There was a contingent liability in respect of a claim fro damages for ₹ 75,000 such liability was settled for ₹ 50,000 and paid by the partner A.
(c) Firm will have to pay ₹ 10,000 as compensation to an injured employee, which was a contingent liability not accepted by the firm.
(d) ₹ 5,000 for damages claimed by a customer has been disputed by the firm. It was settled at 70% by a compromise between the customer and the firm.
Solution:

Question 16.
Pass necessary journal entries on the dissolution of a firm in the following cases:
(a) Dharam, a partner, was appointed to look after the process of dissolution at a remuneration of ₹ 12,000 and he had to bear the dissolution expenses. Dissolution expenses ₹ 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 ₹ 15,000. Jay agreed to bear dissolution expenses. Actual dissolution expenses ₹ 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 ₹ 7,000. Deepa agreed to bear dissolution expenses. Actual dissolution expenses ₹ 6,000 were paid from the firm’s bank account.
(d) Dev, a partner, agreed to do the work of dissolution for ₹ 7,5000. 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 ₹ 10,000. He agreed to bear the dissolution expenses. Actual dissolution expenses paid by Jeev were ₹ 12,000. These expenses were paid by Jeev by drawing cash from the firm.
(f) A debtor of ₹ 8,000 already transferred to Realisation Account agreed to pay the realisation expenses of ₹ 7,800 in full settlement of his account.
Solution:

Question 17.
Ramesh and Umesh were partners in a firm  sharing profits in the ratio of their capitals. On 31st March, 2013, their Balance Sheet was as follows :

On the above date the firm was dissolved.
(a) Ramesh took over 50% of stock at ₹ 10,000 less then the book value. The remaining stock was sold at a loss of ₹ 15,000. Debtors were realised at a discount of 5%.
(b) Furniture was taken over by Umesh for ₹ 50,000 and machinery was sold for ₹ 4,50,000.
(c) Creditors were paid in full.
(d) There was an unrecorded bill for repairs for ₹ 1,60,000 which was settled at ₹ 1,40,000.
Prepare Realisation Account.
Solution:

Question 18.
Balance Sheet of a firm as at 31st March, 2018 , when it was decided to dissolve the same was:

₹19,500 were realised from all assets except Cash at Bank. The cost of winding up came to ₹ 440. X and Y shared profits in the ratio of 2 : 1 respectively.
Prepare Realisation Account and Capital Accounts of Partners.
Solution:

Question 19.
Achal and Vichal were partners in a firm sharing profits in the ratio of 3 : 5. On 31st March, 2018 their Balance Sheet was as follows:

The firm was dissolved on 1st April, 2018 and the Assets and Liabilities were settled as follows:
(a) Land and Building b realised ₹ 4,30,000.
(b) Debtors realised ₹ 2,25,000 (with interest) and ₹ 1,000 were recovered for Bad Debts written off last year.
(c) There was an Unrecorded Investment which was sold for ₹ 25,000.
(d) Vichal took over Machinery at ₹ 2,80,000 for cash.
(e) 50% of the Creditors were paid ₹ 4,000 less in full settlement and the remaining Creditors were paid full amount.
Pass necessary journal entries for dissolution of the firm.
Solution:

Question 20.
Bale and Yale are equal partners of a firm. They decide to dissolve their partnership on 31st March,2018 at which date their Balance Sheet stood as:

(a) The assets realised were:
Stock ₹ 22,000; Debtors ₹ 7,500; Machinery ₹ 16,000; Building ₹ 35,00.
(b) Yale took over the Furniture at ₹ 9,000.
(c) Bale agreed to accept ₹ 2,500 in full settlement of his Loan Account.
(d) Dissolution Expenses amounted to ₹ 2,500.
Prepare the:
(i) Realisation Account
(ii) Capital Accounts of Partners
(iii) Bale’s Loan Account
(iv) Bank Account.
Solution:

Question 21.
Shilpa, Meena and Nanda decided to dissolve their partnership on 31st March, 2018. Their profit-sharing ratio was 3 : 2 : 1 and their Balance Sheet was as under:

It is agreed as follows:
The stock of value of ₹ 41,660 are taken over by Shilpa for ₹ 35,000 and she agreed to discharge bank loan. The remaining stock was sold at ₹ 14,000 and debtors amounting to ₹ 10,000 realised ₹ 8,000. Land is sold for ₹ 1,10,000. The remaining debtors realised 50% at their book value . Cost of realisation amounted to ₹ 1,200. There was a typewriter not recorded in the books worth of ₹ 6,000 which were taken over by one of the Creditors at this value. Prepare Realisation Account, Partners Capital Accounts, and Cash Account to close the books of the firm.
Solution:

Question 22.
A and B are partners in a firm sharing profits and losses in the ratio of 3 : 2. On 31st March, 2018, their Balance Sheet was as follows:

The firm was dissolved on 31st March, 2018 and both the partners agreed to the following:
(a) A took Investments at an agreed value of ₹ 8,000. He also agreed to settle Mrs. A’s Loan.
(b) Other assets realised as : Stock – ₹ 5,000; Debtors – ₹ 18,500; Furniture – ₹ 4,500; Plant – ₹ 25,000.
(c) Expenses of realisation came to ₹ 1,600.
(d) Creditors agreed to accept ₹ 37,000 in full settlement of their claims.
Prepare Realisation Account, Partners Capital Accounts and Bank Account.
Solution:

Question 23.
Balance Sheet of P, Q and R as at 31st March, 2018, who were sharing profits in the ratio of 5 : 3 : 1 was:

The partners dissolved the business. Assets realised Stock – ₹ 23,400; Debtors 50%; Fixed Assets 10% less than their book value. Bills Payable were settled for ₹ 32,000. There was an Outstanding Bill of Electricity ₹ 800 which was paid off. Realisation expenses ₹ 1,250 were also paid.
Prepare Realisation Account, Partner’s Capital Accounts and Bank Account.
Solution:

Question 24.
Vinod, Vijay and Venkat are partners sharing profits and losses in the ratio of 3 : 2 : 1. They decided to dissolve their firm on 31st March, 2018 the date on which their Balance Sheet stood as:

The following additional information is given:
(a) The Investments are taken over by Vinod for ₹ 5,000
(b)

(c) Expenses on realisation amounted to ₹ 2,000.
Close the books of the firm giving relevant Ledger Accounts.
Solution:

Question 25.
P, Q and R were partners in a firm sharing profits and losses in the ratio of 5 : 3 : 2. They agreed to dissolve their partnership firm on 31st March, 2018. P was deputed to realise the assets and pay the liabilities. He as paid ₹ 1,000 as commission for his services. The financial position of the firm was:


P took over Investments for ₹ 12,500. Stock and Debtors realised ₹ 11,500. Plant and Machinery were sold to Q for ₹ 22,500 for cash. Unrecorded assets realised ₹ 1,500. Realisation expenses paid amounted to ₹ 900.
Prepare necessary Ledger Accounts to close the books of the firm.
Solution:

Question 26.
Ashu and Harish are partners sharing profits and losses as 3 : 2 . They decided to dissolve the firm on 31st March, 2018. Their Balance Sheet on the above date was:

The firm was dissolved on 1st April,2018 and the Assets and Liabilities  were settled as follows:
(a) Land and Building b realised ₹ 4,30,000.
(b) Debtors realised ₹ 2,25,000 (with interest) and ₹ 1,000 were recovered for Bad Debts written off last year.
(c) There was an Unrecorded Investment which was sold for ₹ 25,000.
(d) Vichal took over Machinery at ₹ 2,80,000 for cash.
(e) 50% of the Creditors were paid ₹ 4,000 less in full settlement and the remaining Creditors were paid full amount.
Pass necessary journal entries for dissolution of the firm.
Ashu is to take over the building at ₹ 95,000 and Machinery and Furniture is taken over by Harish at value of ₹ 80,000. Ashu agreed to pay Creditor and Harish agreed to meet Bank overdraft. Stock and Investments are taken by both partner in profit-sharing ratio. Debtors realised for ₹ 46,000, expenses of realisation amounted to ₹ 3,000. Prepare necessary Ledger Accounts.
Solution:

Question 27.
A, B and C were equal partners. On 31st March, 2018, their Balance Sheet stood as:

The firm was dissolved on the above date on the following terms:
(a) For the purpose of dissolution, Investments were valued at ₹ 18,000 and A took over the Investments at this value.
(b) Fixed Assets realised ₹ 29,700 whereas Stock and Debtors realised ₹ 80,000.
(c) Expenses of realisation amounted to ₹ 1,300.
(d) Creditors allowed a discount of ₹ 800.
(e) One Bill receivable for ₹ 1,500 under discount was dishonoured as the acceptor had become insolvent and was unable to pay anything and hence the bill had to be met by the firm.
Prepare Realisation Account, Partner’s Capital Accounts and Cash Account showing how the accounts would finally be settled among the partners.
Solution:

Question 28.
A, B and C are in partnership sharing profits and losses in the proportions of 1/2, 1/3 and 1/6 respectively. On 31st March, 2018, they decided to dissolve the partnership and the position of the firm on this date is represented by the following Balance Sheet:

During the course of realisation, a liability under a suit for damages is settled at ₹ 20,000 as against ₹ 5,000 only provided for in the books of the firm.
Land and Building were sold for ₹ 40,000 and the Stock and Sundry Debtors realised ₹ 30,000 and ₹ 42,000 respectively. The expenses of realisation amounted to ₹ 1,200.
There was a car in the firm, which was completely written off from the books. Ir was taken over by A for ₹ 20,000. He also agreed to pay Outstanding Salary of ₹ 20,000 not provided in books.
Prepare Realisation Account, Partners Capital Accounts and Bank Account in the books of the firm.
Solution:

Question 29.
A and B are partners in a firm sharing profits and losses in the ratio of 2 : 1. On 31st March, 2018 their Balance Sheet was:


On that date, the partners decide to dissolve the firm. A took over Investments at an agreed valuation of ₹ 35,000. Other assets were realised as follows:
Sundry Debtors: Full amount. The firm could realise Stock at 15% less and Furniture at 20% less than the book value. Building was sold at ₹ 1,00,000.
Compensation to employees paid by the firm amounted to ₹ 10,000. This liability was not provided for in the above Balance Sheet.
You are required to close the books of the firm by preparing Realisation Account, Partners Capital Accounts and Bank Account.
Solution:

Question 30.
Ashok, Babu and Chetan are in partnership sharing profit in the proportion of 1/2, 1/3, 1/6 respectively.They dissolve the partnership of the 31st March,2018 when the Balance Sheet of the firm as under:

The Machinery was taken over by Babu for ₹ 45,000, Ashok took over the Investments for ₹ 40,000 and Freehold property took over by Chetan at ₹ 55,000. The remaining Assets realised as follows:
Sundry Debtors ₹ 56,500 and Stock ₹ 36,500. Sundry Creditors were settled at discount of 7%. A office computer, not shown in the books of accounts realised ₹ 9,000. Realisation expenses amounted to ₹ 3,000.
Prepare Realisation Account, Partners Capital Accounts and Bank Account.
Solution:

Question 31.
X, Y and Z carrying on business as merchants and sharing profits and losses in the ratio of 2 : 2 : 1, dissolved their firm as at 31st March, 2018 on which date their Balance Sheet was as follows:

A bill for ₹ 5,000 received from Mohan discounted from bank is not met on maturity.
The assets except Cash at Bank and Investments were sold to a company which paid ₹ 3,25,000 in cash.The Investments were sold and ₹ 56,500 were received. Mohan proved insolvent and a dividend of 50% was received from his estate. Sundry Creditors (including Bills Payable) were paid ₹ 57,500 in full settlement. Realisation Expenses amounted to ₹ 15,000.
Prepare Realisation Account, Partners Capital Accounts and Bank Account.
Solution:

Question 32.
Rita chowdhary and Miss Sobha are partners in a firm, Fancy Garments Exports, sharing profits and losses equally. On 1st April, 2018 the Balance Sheet of the firm was:

The firm was dissolved on the date given above. The following transactions took place:
(a) Mrs. Rita Chowdhary undertook to pay Mr.Chowdhary’s Loan and took over 50% of the Stock at a discount of 20%.
(b) Book Debts realised ₹ 54,000; balance of the Stock was sold off at a profit of 30% on cost.
(c) Sundry Creditors were paid out at a discount of 10%. Bills Payable were paid in full.
(d) Plant and Machinery realised ₹ 75,000. Land and Building ₹ 1,20,000.
(e) Mrs. Rita Chowdhary took over the goodwill of the firm at a valuation of ₹ 30,000.
(f) An unrecorded asset of ₹ 6,900 was handed over to an unrecorded liability of ₹ 6,000 in full settlement.
(g) Realisation expenses were ₹ 5,250.
Show Realisation Account, Partners Capital Accounts and Bank Account in the books of the firm.
Solution:

Question 33.
Following is the Balance Sheet of Arvind and Balbir as at 31st March, 2018:


The firm was dissolved on the above date under the following arrangement:
(a) Arvind promised to pay off Mrs. Arvind’s Loan and took Stock at ₹ 6,000.
(b) Balbir took half the Investments @ 10% discount.
(c) Book Debts realised ₹ 28,500.
(d) Trade Creditors and Bills Payable were due on average basis of one month after 31st March,but were paid immediately on 31st March @ 2% discount per annum.
(e) Plant realised ₹ 37,500; Building ₹ 60,000; Goodwill ₹ 9,000 and remaining Investments ₹ 6,750.
(f) An old typewriter, written off completely from the firm’s books now estimated to realise ₹ 450. It was taken by Balbir at this estimated price.
(g) Realisation expenses were ₹ 1,500.
Show Realisation Account, Capital Accounts of Partners and Bank Account.
Solution:

Question 34.
Anju, Manju and Sanju were partners in a firm sharing profits in the ratio of 2 : 2 : 1. On 31st March, 2018, their Balance Sheet was:

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 ₹ 60,000; Stock ₹ 35,500; Investments ₹ 16,000; Plant 90% of the book value. Expenses of Realisation amounted to ₹ 7,500. Commission received in advance was returned to customers after deducting ₹ 3,000.
Firm had to pay ₹ 8,500 for Outstanding Salary, not provided for earlier, Compensation paid to employees amounted to ₹ 17,000. This liability was not provided for in the above Balance Sheet. ₹ 20,000 had to be paid for Employees Provident Fund.
Prepare Realisation Account, Capital Accounts of Partners and Cash Account.
Solution:

Question 35.
A, B and C were in partnership sharing profits in the ratio of 7 : 2 : 1 and the Balance Sheet of the firm as at 31st Marc h, 2018 was:

It was agreed to dissolve the partnership as on 31st March, 2018 and the terms of dissolution were-
(a) A to take over the Building at an agreed amount of ₹ 31,500;
(b) B who was to carry on the business to take over the Goodwill, Stock and Debtors at book value, the Patents at ₹ 30,000 and Plant at ₹ 30,000 and Plant at ₹ 5,000. He was also to pay the Creditors;
(c) C to take over shares in X Ltd. at ₹ 15 each and
(d) The shares in Y Ltd.to be divided in the profit-sharing ratio.
Show Ledger Accounts recording the dissolution in the books of the firm.
Solution:

Question 36.
Following is the Balance Sheet of Vishnu, Sanjiv and Sudhir as at 31st March, 2018:


Profit-sharing ratio of the partners is 5 : 3 : 2. At the above date, the partners decided to dissolve the firm.
The assets were realised as follows:
Bill Receivable were realised at a discount of 5%. All Debtors were good. Stock realised ₹ 22,000. Land and Building realised 40% higher than the book value. Furniture was sold for ₹ 8,000 by auction and auctioneer’s commission amounted to ₹ 500.
Computers were taken by Vishnu for ana greed valuation of ₹ 3,000. Investments were sold in the open market at a price of ₹ 45,000 for which commission of ₹ 600 was paid to the broker.
Bills Payable were paid at full amount. Creditors however agreed to accept 10% less. All other liabilities were paid off at their book value.
The firm retrenched their employees three months before the dissolution of the firm and firm had to pay ₹ 20,000 as compensation.
Prepare Realisation Account, Partners Capital Accounts and Cash Account.
Solution:

Question 37.
A, B and C were partners sharing profits in the ratio of 2 : 2 : 1. They decided to dissolve their firm on 31st March, 2018 when the Balance Sheet was:

Following transactions took place:
(a) A took over Stock at ₹ 36,000. He also took over his wife’s loan.
(b) B took over half of Debtors at ₹ 28,000.
(c) C took over Investments at ₹ 54,000 and half of Creditors at their book value.
(d) Remaining Debtors realised 60% of their book value. Furniture sold for ₹ 30,000; Machinery ₹ 82,000 and Land ₹ 1,20,000.
(e) An unrecorded asset was sold for ₹ 22,000.
(f) Realisation expenses amounted to ₹ 4,000.
Prepare necessary Ledger Accounts to close the books of the firm.
Solution:

Question 38.
Krishna and Arjun are partners in a firm. They share profits in the ratio of 4 : 1. They decided to dissolve the firm on 31st March, 2018 at which date their Balance Sheet stood as:

The realisation shows the following results:
(a) Goodwill was sold for ₹ 1,000.
(b) Debtors were realised at book value less 10%.
(c) Trademarks were realised for ₹ 800.
(d) Machinery and Stock-in-Trade were taken over by Krishna for ₹ 14,400 and ₹ 3,600 respectively.
(e) An unrecorded asset estimated at ₹ 500 was sold for ₹ 200.
(f) Creditors for goods were settled at a discount of ₹ 80. The expenses on realisation were ₹ 800.
Prepare Realisation Account, Partner’s Capital Accounts and Bank Account.
Solution:

Question 39.
There are two partners X and Y in a firm and their capitals are ₹ 50,000 and ₹ 40,000. The creditors are ₹ 30,000. The assets of the firm realise ₹ 1,00,000. How much will X and Y receive ?
Solution:

Question 40.
A, B and C were partners sharing profits int he ratio of 5 : 3 : 2. On 31st March, 2018, A’s Capital and B’s Capital were ₹ 30,000 and ₹ 20,000 respectively but C owed ₹ 5,000 to the firm. the liabilities were ₹ 20,000. The assets of the firm realised ₹ 50,000.
Prepare Realisation Account, Partner’s Capital Accounts and Bank Account.
Solution:

Question 41.
A and B were partners sharing profits and losses as to 7/11th to A and 4/11th to B. They dissolved the partnership on 30th May, 2018. As on that date their capitals were: A ₹ 7,000 and B ₹ 4,000. There were also due on Loan A/c to A ₹ 4,500 and to B ₹ 750. The other liabilities amounted to ₹ 5,000. The assets proved to have been undervalued in the last Balance Sheet and actually realised ₹ 24,000.
Prepare necessary accounts showing the final settlement between partners.
Solution:

Question 42.
A and B dissolve their partnership. Their position as at 31st March, 2018 was:

The balance of A’s Loan Account to the firm stood at ₹ 10,000. The realisation expenses amounted to ₹ 350. Stock realised ₹ 20,000 and Debtors ₹ 25,000. B took a machine at the agreed valuation of ₹ 7,500.
You are required to close the books of the firm.
Solution:

Question 43.
Ashok and Kishore were in partnership sharing profits in the ratio of 3 : 1. They agreed to dissolve the firm. The assets (other than cash of ₹ 2,000) of the firm realised ₹ 1,10,000. The liabilities and other particulars on that date were:

You are required to close the books of the firm.
Solution:

Question 44.
X, Y and Z entered into a partnership and contributed ₹ 9,000; ₹ 6,000 and ₹ 3,000 respectively. They agreed to share profits and losses equally. The business lost heavily during the very first year and they decided to dissolve the firm. After realising all assets and paying off liabilities , there remained a cash balance of ₹ 6,000.
Prepare Realisation Account and Partner’s Capital Accounts.
Solution:

Question 45.
A, B and C started business on 1st April, 2016 with capitals of ₹ 1,00,000; ₹ 80,000 and ₹ 60,000 respectively sharing profits (losses) in the ratio of 4 : 3 : 3. For the year ended 31st March, 2017 the firm suffered a loss of ₹ 50,000. Each of the partners withdrew ₹ 10,000 during the year.
On 31st March, 2017, the firm was dissolved, the creditors of the firm stood at ₹ 24,000 on that date and Cash in Hand was ₹ 4,000. The assets realised ₹ 3,00,000 and Creditors were paid ₹ 23,500 in full settlement of their claims.
Prepare Realisation Account and show your workings clearly.
Solution:

Question 46.
A, B and C were in partnership sharing profits and losses in the ratio of 2 : 1 : 1. They decided to dissolve the partnership. On that date of dissolution, Sundry Assets (including cash ₹ 5,000) amounted to ₹ 88,000, assets realised ₹ 80,000 (including an unrecorded asset which realised ₹ 4,000). A contingent liability on account of bills discounted ₹ 8,000 was paid by the firm. The Capital Accounts of A, B and C showed a balance of ₹ 20,000 each.
Prepare Realisation Account, Partners Capital Accounts and Cash Account.
Solution:

Question 47.
On 1st April, 2017, A, B and C commenced business in partnership sharing profits and losses in proportion of 1/2, 1/3 and 1/6 respectively. They paid into their Bank A/c as their capitals ₹ 22,000; ₹ 10,000 by A, ₹ 7,000 by B, ₹ 5,000 by C. During the year , they drew ₹ 5,000; being ₹ 1,900 by A, ₹ 1,700 by B, ₹ 1,400 by C.
On 31st March, 2018, they dissolved their partnership, A taking up Stock at an agreed valuation of ₹ 5,000, B taking up Furniture at ₹ 2,000 and C taking up Debtors at ₹ 3,000. After paying up their Creditors, there remained a balance of ₹ 1,000 at Bank. Prepare necessary accounts showing the distribution of the cash at the Bank and of the further cash brought in by any partner or partners as the case required.
Solution:

Question 48.
The partnership between A and B was dissolved on 31st March, 2018. On that date the respective credits to the capitals were A ₹ 1,70,000 and B ₹ 30,000. ₹ 20,000 were owed by B to the firm; ₹ 1,00,000 were owed by the firm to A and ₹ 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 realise ₹ 4,50,000 exclusive of ₹ 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.
Solution:

Question 49.
X and Y were partners sharing profits and losses in the ratio of 3 : 2. They decided to dissolve the firm on 31st March, 2018. On that date their Capitals were X ₹ 40,000 and Y ₹ 30,000. Creditors amounted to ₹ 24,000.
Assets were realised for ₹ 88,500. Creditors of ₹ 16,000 were taken over by X at ₹ 14,000. Remaining Creditors were paid at ₹ 76,500. The cost of realisation came to ₹ 500.
Prepare necessary accounts.
Solution:

Question 50.
P, Q and R are three partners sharing profits and losses in the ratio of 3 : 3 : 2 respectively. Their respective capitals are in their profit-sharing proportions. On 1st April, 2017 the total capital of the firm and the balance of General Reserve are ₹ 80,000 and ₹ 20,000 respectively. During the year 2017-18 the firm made a profit of ₹ 28,000 before charging interest on capital @ 5%. The drawings of the partners are P ₹ 8,000; Q ₹ 7,000; and R ₹ 5,000. On 31st March, 2018 their liabilities were ₹ 18,000.
On this date, they decided to dissolve the firm. The assets realised ₹ 1,08,600 and realisation expenses amounted to ₹ 1,800.
Prepare necessary Ledger Accounts to close the books of the firm.
Solution:

Question 51.
X, Y and Z entered into partnership on 1st April, 2016. They contributed capital ₹ 40,000, ₹ 30,000 and ₹ 20,000 respectively and agreed to share profits in the ratio of 3 : 2 : 1. Interest on capital was to be allowed @ 15% p.a. and interest on drawing was to be charged at an average rate of 5%. During the two years ended 31st March, 2018, the firm made profit of ₹ 21,600 and ₹ 25,140 respectively before allowing or charging interest on capital and drawings. The drawings of each partner were ₹ 6,000 per year.
On 31st March,2018 the partners decided to dissolve the partnership due to difference of opinion. On that date, the creditors amounted to ₹ 20,000. The assets other than cash ₹ 2,000 realised ₹ 1,21,000. Expenses of dissolution amounted to ₹ 760.
Draw up necessary Ledger Account to close the books of the firm.
Solution:

We hope the TS Grewal Accountancy Class 12 Solutions Chapter 6 Dissolution of Partnership Firm help you. If you have any query regarding TS Grewal Accountancy Class 12 Solutions Chapter 6 Dissolution of Partnership Firm, drop a comment below and we will get back to you at the earliest.

TS Grewal Accountancy Class 12 Solutions Chapter 9 Issue of Debentures are part of TS Grewal Accountancy Class 12 Solutions. Here we have given TS Grewal Accountancy Class 12 Solutions Chapter 9 Issue of Debentures.

TS Grewal Accountancy Class 12 Solutions Chapter 9 Issue of Debentures

Question 1.
Vishwas Ltd. issued 2,000; 9% Debentures of ₹ 100 each payable as follows:
₹ 25 on application; ₹ 25 on allotment and ₹ 50 on first and final call.
Applications were received for all the debentures along with the application money did allotment was made. Call money was also received on the due date.
Pass necessary Journal entries in the books of the company.
Solution:

Question 2.
A Ltd. issued 2,000; 9% Debentures of ₹ 100 each on the following terms:
₹ 20 on applications ; ₹ 20 on allotment ; ₹ 30 on first call ; ₹ 30 on final call.
The public applied for 2,400 debentures. Applications for 1,800 debentures were accepted in full. Applications for 400 debentures were allotted 200 debentures and applications for 200 debentures were rejected. Pass necessary Journal entries.
Solution:

Question 3.
ABC Ltd. issued 40,000; 10% Debentures of ₹ 100 each at par for cash payable in full along with the application. Applications were received for 60,000 debentures. Debentures were allotted and excess application money was refunded. Pass Journal entries in the books of the company.
Solution:

Question 4.
Narain Laxmi Ltd. invited applications for issuing 7,500; 12% Debentures of ₹ 100 each at a premium of ₹ 35 per debenture. The full amount was payable on application. Applications were received for 10,000 Debentures. Allotment was made to all the applications on pro rata.
Pass necessary Journal entries for the above transactions in the books of Narain Laxmi Ltd.
Solution:

Question 5.
Raj Ltd. issued 5,000; 8% Debentures of ₹ 100 each at a premium of 5% payable as follows:
₹ 10 on application; ₹ 20 along with premium on allotment and balance on first and final call.
Pass necessary Journal entries.
Solution:

Question 6.
Nipa Limited issued ₹ 10,00,000 Debentures of ₹ 100 each at a premium of 10%, payable 25% on application (including premium) and the balance on allotment. The debentures were applied for and the amount was dully received.
You are required to give Journal entries and prepare Cash Book.
Solution:

Question 7.
Alok Ltd. issued 7,000, 10% Debentures of ₹ 500 each at a premium of ₹ 50 per debenture redeemable at a premium of 10% after 5 years. According to the terms of issue, ₹ 200 was payable on application and balance on allotment.
Record necessary Journal entries at the time of issue of 10% Debentures.
Solution:

Question 8.
Vijay Laxmi Ltd. invited applications for 10,000; 12% Debentures of ₹ 100 each at a premium of ₹ 70 per debenture. The full amount was payable on application.
Applications were received for 13,500 debentures. Applications for 3,500 debentures were rejected and application money was refunded. Debentures were allotted to the remaining applications.
Solution:

Question 9.
Iron Products Ltd. issued 5,000; 9% Debentures of ₹ 100 each at a premium of ₹ 40 payable as follows:
(i) ₹ 40, including premium of ₹ 10 on applications;
(ii) ₹ 45, including premium of ₹ 15 on allotment and
(iii) Balance as first and final call.
The issue was subscribed and allotment made. Calls were made and due amount was received.
Pass Journal entries.
Solution:

Question 10.
X Ltd. issued 12,000; 8% Debentures of ₹ 100 each at a discount of 5% payable as 25% on application; 20% on allotment and balance after three months. Pass Journal entries.
Solution:

Question 11.
Alka Ltd. issued 5,000, 10% Debentures of ₹ 1,000 each at a discount of 10% redeemable at a premium of 5% after 5 years. According to the terms of issue ₹ 500 was payable on application and the balance amount on allotment of debentures. Record necessary entries regarding issue of 10% Debentures.
Solution:

Question 12.
Amrit Ltd. was promoted by Amrit and Bhaskar with an authorised capital of ​₹ 10,00,000 divide into 1,00,000 shares of ₹ 10 each.
The company decided to issue 1,000, 6% Debentures of ₹ 100 each to Amrit and Bhaskar each for their services in incorporating the company. Pass journal entry.
Solution:

Question 13.
A limited company bought a Building for ₹ 9,00,000 and the consideration was paid by issuing 10% Debentures of the normal (face) value of ​₹ 100 each at a discount of 10%. Give journal entries.
Solution:

Question 14.
Wye Ltd. purchased an established business for ​₹ 2,00,000 payable as ₹ 65,000 by cheque and the balance by issuing 9% Debentures of ​₹ 100 each at a discount of 10%.
Give journal entries in the books of Wye Ltd.
Solution:

Question 15.
Newton Ltd. purchased a Machinery from B for ₹ 5,76,000 to be paid by the issue of 9% Debentures of ​₹ 100 each at 4% discount. Journalise the trasactions.
Solution:

Question 16.
Reliance Ltd. purchased machinery costing ₹ 1,35,000. It was agreed that the purchase consideration be paid by issuing 9% Debentures of ₹ 100 each. Assume debentures have been issued
(i) at par and
(ii) at a discount of 10%.
Give necessary journal entries.
Solution:

Question 17.
Deepak Ltd purchased furniture of ₹ 2,20,000 from M/s. Furniture Mart. 50% of the amount was paid to M/s. Furniture Mart by accepting a Bill of Exchanged and for the balance the company issued 9% Debenture of ₹ 100 each at a premium of 10% in favour of M/s. Furniture Mart.
Pass Journal entries in the books of Deepak Ltd.
Solution:

Question 18.
X Ltd. took over the assets of ₹ 6,00,000 and liabilities of ₹ 80,000 of Y Ltd for an agreed purchase consideration of ₹ 6,00,000 payable 10% in cash and the balance by the issue of 12% Debentures of ₹ 100 each. Give necessary journal entries in the books of X Ltd., assuming that:
Case (a): The debentures are issued at par.
Case (b): The debentures are issued at 20% premium.
Case (c): The debentures are issued at 10% discount.
Solution:

Question 19.
X Ltd. took over the assets of ₹ 6,60,000 and liabilities of ₹ 80,000 of Y Ltd. for ₹ 6,00,000. Give necessary journal entries in the books of X Ltd. assuming that:
Case (a): The purchase consideration was payable 10% in cash and the balance in 5,400; 12% Debentures of ₹ 100 each.
Case (b): The purchase consideration was payable 10% in cash and the balance in 4,500; 12% Debentures of ₹ 100 each issued at 20% premium.
Solution:

Question 20.
Perfect Barcode Ltd. purchased computers from M/s. Computer Mart and paid the consideration as follows:
(a) 1,000, 10% Debentures of ₹ 100 each at a discount of 10% ; and
(b) Issued a cheque for ₹ 80,000 for the balance amount.
Pass the journal entry in the books of Perfect Barcode Ltd.
Solution:

Question 21.
Lotus Ltd. took over assets of ₹ 2,50,000 and liabilities of ₹ 30,000 of Goneby Company for the purchase consideration of ₹ 3,30,000. Lotus Ltd. paid the purchase consideration by issuing debentures of ₹ 100 each at 10% premium.
Give journal entries in the books of Lotus Ltd.
Solution:

Question 22.
Exe Ltd. purchased the assets of the book value ₹4,00,000 and took over the liabilities of ₹ 50,000 from Mohan Bros.It was agreed that the purchase consideration, settled at ₹ 3,80,000 be paid by issuing debentures of ₹ 100 each.
Pass journal entries if debenture are issued:
(a) at par
(b) at a discount of 10% and
(c) at a premium of 10%.
It was agreed that any fraction of debentures be paid in cash.
Solution:

Question 23.
R Ltd. purchased the assets of S Ltd. for ₹ 5,00,000. It also agreed to take over the liabilities of S Ltd. amounted to ₹ 2,00,000 for a purchase consideration of ₹ 2,80,000. The payment of S Ltd. was made by issue of 9% Debentures of ₹ 100 each at par.
Pass necessary journal entries in the books of R Ltd.
Solution:

Question 24.
Romi Ltd. acquired assets of ₹ 20 lakhs and took over creditors of ₹ 2 lakhs from Kapil Enterprises.
Romi Ltd. issued 8% Debentures of ₹ 100 each at a discount of 25% as purchase consideration.
Record necessary journal entries in the books of Romi Ltd.
Solution:

Question 25.
Romi Ltd. acquired assets of ₹ 20 lakhs and took over creditors of ₹ 2 lakhs from Kapil Enterprises.
Romi Ltd. issued 8% Debentures of ₹ 100 each at a discount of 10% as purchase consideration.
Record necessary journal entries in the books of Romi Ltd.
Solution:

Question 26.
X Ltd. issued 10% Debentures of nominal value of ₹ 10,00,000 as follows:
(i) To sundry persons for cash at par ₹ 5,00,000 nominal.
(ii) To a vendor for ₹ 5,50,000 for purchase of fixed assets ₹ 5,00,000 nominal.
Pass journal entries in the books of X Ltd.
Solution:

Question 27.
Best Barcode Ltd. took a loan of ₹ 5,00,000 from a bank giving ₹ 6,00,000; 9% Debentures as collateral security. Pass journal entries regarding issue of debentures, if any, and show this loan in the Balance Sheet of the company.
Solution:

Question 28.
A company took a loan of ₹ 4,00,000 from Bandhan Bank Ltd. and issued 8% Debentures of ₹ 4,00,000 as a collateral security.
Solution:

Question 29.
X Ltd. took a loan of ₹ 3,00,000 from IDBI Bank. The company issued 4,000; 9% Debentures of ₹ 100 each as a collateral security for the same. Show how these items will be presented in the Balance Sheet of the company.
Solution:

Question 30.
Journalise the following:
(a) A debenture issued at ₹ 95, repayable at ₹ 100.
(b) A debenture issued at ₹ 95, repayable at ₹ 105.
(c) A debenture issued at ₹95, repayable at ₹ 105.
The face value of debenture is ₹ 100 in each of the above cases.
Solution:

Question 31.
Pass journal entries in the following cases:
(a) A Co.Ltd. issued ₹ 40,000; 12% Debentures at a premium of 5% redeemable at par.
(b) A Co.Ltd. issued ₹ 40,000; 12% Debentures at a discount of 10% redeemable at par.
(c) A Co.Ltd. issued ₹ 40,000; 12% Debentures at par redeemable at 10% premium.
(d) A Co.Ltd. issued ₹ 40,000; 12% Debentures at a discount of 5% and redeemable at 5% premium.
(e) A Co.Ltd. issued ₹ 40,000; 12% Debentures at a premium of 10% redeemable at 110%.
Solution:

Question 32.
Footfall Ltd.issues 10,000 Debentures of Pass necessary journal entries relating to the issue of Debentures for the following:
(a) Issued ₹ 28,000; 10% Debentures of ₹ 100 each at a premium of 15% redeemable at par.
(b) Issued ₹ 30,000; 10% Debentures of ₹ 100 each at a premium of 10% and redeemable at a premium of 15%.
(c) Issued ₹ 80,000; 10% Debentures of ₹ 100 each at par repayable at a premium of 10%. 100 each at a discount of 10% redeemable at a premium of 5% after the expiry of three years.
Pass journal entries for the issue of these debentures.
Solution:

Question 33.
Pass necessary journal entries relating to the issue of Debentures for the following:
(a) Issued ₹ 4,00,000; 9% Debentures of ₹ 100 each at a premium of 8% redeemable at 10% premium.
(b) Issued ₹ 6,00,000; 9% Debentures of ₹ 100 each at par, repayable at a premium of 10%.
(c) Issued ₹ 10,00,000; 9% Debentures of ₹ 100 each at a premium of 5%,redeemable at par.
Solution:

Question 34.
Pass necessary journal entries relating to the issue of Debentures for the following:
(a) Issued ₹ 28,000; 10% Debentures of ₹ 100 each at a premium of 15% redeemable at par.
(b) Issued ₹ 30,000; 10% Debentures of ₹ 100 each at a premium of 10% and redeemable at a premium of 15%.
(c) Issued ₹ 80,000; 10% Debentures of ₹ 100 each at par repayable at a premium of 10%.
Solution:

Question 35.
Journalise the following transaction at the time of issue of 12% Debentures:
Nandan Ltd. issued ₹ 90,000, 12% Debentures of ₹ 100 each at a discount of 5% redeemable at 110%.
Solution:

Question 36.
Pass necessary journal entries for the issue of Debentures in the following cases:
(a) ₹ 40,000; 12% Debentures of ₹ 100 each issued at a premium of 5% redeemable at par.
(b) ₹ 70,000; 12% Debentures of ₹ 100 each issued at a premium of 5% redeemable at a premium of 110.
Solution:

Question 37.
Pass necessary journal entries for the issue of Debentures in the following cases:
(a) ₹ 40,000; 15% Debentures of ₹ 100 each issued at a discount of 10% redeemable at par.
(b) ₹ 80,000; 15% Debentures of ₹ 100 each issued at a premium of 10% redeemable at a premium of 10%.
Solution:

Question 38.
XYZ Ltd.issued 5,000, 10% Debentures of ₹ 100 each on 1st April, 2015 at a discount of 10% redeemable at a premium of 10% after 4 years. Give journal entries for the year ended 31st March, 2016, assuming that the interest was payable half-yearly on 30th September and 31st March. Tax is to be deducted @ 10%.
Solution:

Question 39.
Bright Ltd. issued 5,000; 10% Debentures of ₹ 100 each on 1st April, 2015. The issue was fully subscribed. According to the terms of issue, interest on the debentures is payable half-yearly on 30th September and 31st March and the tax deducted at source is 10%.
Pass necessary journal entries related to the debenture interest for the year ending 31st March, 2016 and transfer of interest on debentures of the year to the Statement of Profit and Loss.
Solution:

Question 40.
On 1st April, 2015, V.V.L. Ltd issued 1,000, 9% Debentures of ₹ 100 each at a discount of 6%, redeemable at a premium of 10% after three years. Pass necessary journal entries for the issue of debentures and debenture interest for the year ended 31st March, 2016, assuming that interest is payable on 30th September and 31st March and the rate of tax deducted at source is 10%. The company closes its books on 31st March every year.
Solution:

Question 41.
X Ltd. issued 30,000, 10% Debentures of ₹ 100 each at a discount of 5% on 1st April, 2015. As per the terms of issue, debentures are to be redeemed at the end of five years. Show the amount of discount to be written off from Statement of Profit and Loss every year.
Solution:

Question 42.
A limited company issued ₹ 10,00,000; 9% Debentures at a discount of 6% on 1st April, 2014. These debentures are to be redeemed equally, in 5 annual installments starting from 31st March, 2015. Discount on Issue of Debentures is written off during the tenure of debentures.
Pass the journal entries for issue of debentures and writing off the discount.
Solution:

Question 43.
On 1st April, 2014, Popular Ltd. issued 20,000; 10% Debentures of ₹ 100 each at a discount of 10% redeemable at par. Show the Discount on Issue of Debentures Account if
(a) such debentures are redeemable after 4 years, and
(b) such debentures are redeemable by equal annual drawings in 4 years, starting from 31st March, 2015. Popular Ltd. follows financial year as its accounting year.
Solution:

Question 44.
On 1st April 2012, Z Ltd. issued ₹ 10,00,000, 10% Debentures of ₹ 100 each at 94% redeemable at par. The debentures are to be redeemed by drawings method in the following manner:

Calculate the amount of discount on issue of debentures to be written off each year.
Solution:

Question 45.
A company issued 9% Debentures of ₹ 10,00,000 at 8% discount, redeemable at par. The debentures are to be redeemed by drawings method in the following manner:

Calculate the amount of discount on issue of debentures to be written off each year.
Solution:

Question 46.
Kangaroo Ltd. issued 5,000, 8% Debentures of ₹ 100 each at a discount of 8%. The company decided to write off discount in the year of loss from Capital Reserve which has a balance of ₹ 1,00,000. Pass the journal entry for writing off discount.
Solution:

Question 47.
Grand Hotels Ltd.issued 30,000, 7% Debentures of ₹ 100 each at a discount of 5% redeemable at a premium of 5%. It decided to write off loss on issue of debentures first from Capital Reserve then from Securities Premium Reserve and balance from Statement of Profit and Loss. It has balances as follows:
Capital Reserve – ₹ 80,000 and Securities Premium Reserve – ₹ 1,00,000.
Pass the journal entry for writing off loss on Issue of Debentures.
Solution:

Question 48.
Kitply Ltd.issued ₹ 2,00,000, 10% Debentures at a discount of 5%. The terms of issue provide the repayment at the end of 4 years. Kitply Ltd.has a balance of ₹ 5,00,000 in Securities Premium Reserve. The company decided to write off discount on issue of debentures from Securities Premium Reserve in the first year.
Pass the journal entry.
Solution:

Question 49.
Typhoo Ltd.issued 5,000, 9% Debentures of ₹ 100 each at a discount of 5% redeemable at the end of 5 years at a premium of 10%. Typhoo Ltd.has a balance of ₹ 2,00,000 in Securities Premium Reserve. Loss on Issue of debentures is to be written off equally over the life of debentures from Securities Premium Reserve to the extent possible.
Pass the journal entries for writing off the Loss on Issue of Debentures.
Solution:

Question 50.
Tetley Ltd. issued 10,000, 9% Debentures of ₹ 100 each at a discount of 5% redeemable at the end of 5 years at a premium of 10%. Tetley Ltd. has a balance of ₹ 50,000 in Securities Premium Reserve. Loss on Issue of debentures is to be written off equally over the life of debentures.
Pass the journal entries for writing off the Loss on Issue of Debentures.
Solution:

Question 51.
Global Ltd.issued 10,000, 8% Debentures of ₹ 100 each redeemable at the end of 3 years at a premium of ₹ 9.
Pass the journal entries for writing off the Loss on Issue of Debentures. Also prepare Loss on Issue of Debentures Account.
Solution:

Question 52.
On 1st April, 2013, ABC Ltd. issued 10,000, 10% Debentures of ₹ 100 each at a discount of 4% redeemable after 5 years at a premium of 6%.
Pass the necessary journal entries for issue of debentures and writing off Loss on issue of Debentures. Also prepare Loss on issue of Debentures Account.
Solution:

Question 53.
Feeble Ltd.issued 10% Debentures at 94% for ₹ 20,00,000 on 1st July, 2013 repayable by five equal annual installments of ₹ 4,00,000 each starting from 30th June, 2014. Calculate the amount of discount to be written off in every accounting year assuming that the company decides to write off the debentures discount during the life of the debentures.
Solution:

Question 54.
On 1st May, 2016, Goodluck Ltd. issued 16,000, 9% Debentures of ₹ 100 each at a discount of 10% redeemable at a premium of 10% redeemable after five years. All the debentures were subscribed and allotment was made. Discount on issue of Debentures is to be written off over the life of the debentures.
Prepare the Balance Sheet (extract) as at 31st March, 2017 showing Discount on issue of Debentures.
Solution:

Question 55.
On 1st June, 2015, R Energy Ltd. issued 10,000, 7% Debentures of ₹ 100 each at a discount of 10% redeemable at a premium of 10% at the end of five years. All the debentures were subscribed and allotment was made. Loss on issue of Debentures is to be written off over the life of the debentures.
Prepare the Balance Sheet (extract) as at 31st March, 2016 and 31st March, 2017 showing Loss on issue of Debentures.
Solution:

We hope the TS Grewal Accountancy Class 12 Solutions Chapter 9 Issue of Debentures help you. If you have any query regarding TS Grewal Accountancy Class 12 Solutions Chapter 9 Issue of Debentures, drop a comment below and we will get back to you at the earliest.

TS Grewal Accountancy Class 12 Solutions Chapter 7 Company Accounts Financial Statements of Not-for-Profit Organisations are part of TS Grewal Accountancy Class 12 Solutions. Here we have given TS Grewal Accountancy Class 12 Solutions Chapter 7 Company Accounts Financial Statements of Not-for-Profit Organisations.

TS Grewal Accountancy Class 12 Solutions Chapter 7 Company Accounts Financial Statements of Not-for-Profit Organisations

Question 1.
From the following particulars of Evergreen club, prepare Receipts and payments Account for the year ended 31st March,2018:

Solution:

Question 2.
How are the following items shown in the accounts of a Not-for-Profit Organisation ?

Solution:

Question 3.
How are the following dealt with in the accounts of a Not-for-Profit Organisation ?

Solution:

Question 4.
How are the following dealt with while preparing the final accounts of a club?

Solution:

Question 5.
From the following information of a club show the amounts of match expenses and match fund in the appropriate Financial Statements of the club for the year ended on 31st March, 2018:

Solution:

Question 6.
Show how are the following items dealt with while preparing the final accounts for the year ended 31st March , 2018 of a Not-for-profit Organisation:
Case I: Expenditure on construction of Pavilion is ₹ 6,00,000. The construction work is in progress  and has not yet completed.
Capital Fund as at 31st March , 2017 is ₹ 20,00,000.
Case II: Expenditure on construction of Pavilion is ₹ 6,00,000. The construction work is in progress and has not yet completed.
Pavilion Fund as at 31st March, 2017 is ₹ 10,00,000 and Capital Fund as at 31st March, 2017 is ₹ 20,00,000.
Case III: Expenditure on construction of Pavilion is ₹ 6,00,000. The construction work is in progress and has not yet completed.
Pavilion Fund as at 31st March, 2017 is ₹ 10,00,000, and Capital Fund as at 31st March, 2017 is ₹ 20,00,000 .
Donation Received for Pavilion on 1st January, 2018 is ₹ 5,00,000.
Solution:

Question 7.
How is Entrance Fees dealt with while preparing the final accounts for the year ended 31st March, 2018 in each of the following alternative cases?
Case I: During the year ended 31st March, 2018, Entrance Fees received was ₹ 1,00,000.
Case II: During the year ended 31st March, 2018, Entrance Fees received was ₹ 1,00,000. Out of this ₹ 25,000 was received from individuals whose membership is not yet approved.
Solution:

Question 8.
In the year ended 31st March, 2018, the subscriptions received by the jaipur Literary Society were ₹ 4,20,000. These subscriptions include ₹ 14,000 received for the year ended 31st March, 2017. On 31st March, 2018, subscriptions due but not received were ₹ 10,000. What amount should be credited to Income and Expenditure Account for the year ended 31st March, 2018 as subscription ?
Solution:

Question 9.
Subscriptions received during the year ended 31st March, 2018 are:

There are 450 members, each paying an annual subscription of ₹ 200; ₹ 1,800 were in arrears for the year ended 31st March, 2017.
calculate amount of subscriptions to be credited to Income and Expenditure Account for the year ended 31st March, 2018.
Solution:

Question 10.
In the year ended 31st March, 2018 subscriptions received by Kings Club, Delhi were ₹ 4,09,000 including ₹ 5,000 for the year ended 31st March, 2017 and ₹ 10,000 for the year ended 31st March, 2019. At the end ₹ 15,000. The subscriptions due but not received at the end of the previous year, i.e., 31st March, 2017 were ₹ 8,000, while subscriptions received in advance on the same date were ₹ 18,000.
Calculate amount of subscriptions to be credited to Income and Expenditure Account for the year ended 31st March, 2018.
Solution:

Question 11.
From the following information, calculate amount of subscriptions to be credited to the Income and Expenditure Account for the year ended 31st March, 2018:

Subscriptions received during the year ended 31st March, 2018 – ₹ 3,00,000
Solution:

Question 12.
Calculate amount of subscriptions which will be treated as income for the year ended 31st March, 2018 for each of the following cases:

Solution:

Question 13.
From the following particulars, calculate amount of subscriptions to be credited to the Income and Expenditure Account for the year ended 31st March, 2018:
(a) Subscriptions in arrears on 31st March, 2017 – ₹ 500
(b) Subscriptions received in advance on 31st March, 2017 for the year ended on 31st March, 2018 – ₹ 1,100
(c) Total Subscriptions received during the year ended 31st March, 2018 – ₹ 35,400
(including ₹ 400 for the year ended 31st March, 2017 ₹ 1,200 for the year ended 31st March, 2019 and ₹ 300 for the year ended 31st March, 2020)
(d) Subscriptions outstanding for year ended 31st March, 2018 – ₹ 400
Solution:

Question 14.
Receipts and Payments Account of Friends Club showed that ₹ 6,85,000 were received by way of subscriptions for the year ended on 31st March, 2018.
The additional information was as under:
(a) Subscription outstanding as on 31st March, 2017 were – ₹ 65,000.
(b) Subscription received in advance as on 31st March, 2017 were – ₹ 41,000.
(c) Subscription outstanding as on 31st March, 2018 were – ₹ 54,000.
(d) Subscription received in advance as on 31st March, 2018 were – ₹ 25,000.
Show how the above information would appear in the final accounts for the year ended on 31st March, 2018 of Friends Club.
Solution:

Question 15.
How are the following items of subscriptions shown in the Income and Expenditure Account for the year ended 31st March, 2018 and Balance Sheets as at 31st March, 2017 and 2018 ?
Subscriptions received during the year ended 31st March, 2018 – ₹ 3,58,500
Subscriptions outstanding on 31st March, 2017 – ₹ 30,000
Subscriptions received in Advance on 31st March, 2017 – ₹ 22,500
Subscriptions received in Advance on 31st March, 2018 – ₹ 13,500
Subscriptions outstanding on 31st March, 2018 – ₹ 37,500
(including ₹ 12,500 for the year ended 31st March, 2017)
Solution:

Question 16.
From the following information , calculate amount of subscriptions outstanding for the year ended 31st March, 2018:
A club has 200 embers each paying an annual subscription of ₹ 1,000. The Receipts and Payments Account for the year showed a sum of ₹ 2,05,000 received as subscriptions. The following additional information is provided:
Subscriptions Outstanding on 31st March, 2017 – ₹ 30,000
Subscriptions Received in Advance on 31st March, 2018 – ₹ 40,000
Subscriptions Received in Advance on 31st March, 2017 – ₹ 14,000
Solution:

Question 17.
On the basis of information given below, calculate the amount of medicines to be debited to the Income and Expenditure Account of Good Health Hospital for the year ended 31st March, 2018:

Medicines purchased during the year ended 31st March, 2018 were ₹ 60,80,700.
Solution:

Question 18.
Calculate amount of medicines consumed during the year ended 31st March, 2018:
Opening Stock of Medicines – ₹ 1,00,000
Opening Creditors for Medicines – ₹ 90,000
Cash purchases of Medicines during the year – ₹ 3,00,000
Closing Stock of Medicines – 1,50,000
Closing Creditors for Medicines – 1,30,000
Solution:

Question 19.
Calculate amount to be posted to the Income and Expenditure Account for the year ended 31st March, 2018:
(i) Amount paid for stationery during the year ended 31st March, 2018 – ₹ 5,400; Stock of Stationery in Hand on 31st March, 2018 – ₹ 250.
(ii) Stock of Stationery in Hand on 1st April, 2017 – ₹ 1,500; Payment made for Stationery during the year ended 31st March, 2018 – ₹ 5,400; Stock of Stationery in Hand on 31st March, 2018 – ₹ 250.
(iii) Stock of Stationery on 1st April, 2017 – ₹ 1,500
Creditors for Stationery on 1st April, 2017 – ₹ 1,000
Amount paid for Stationery during the year – ₹ 5,400
Stock of Stationery on 31st March, 2018 – ₹ 250
Solution:

Question 20.
On the basis of the following information, calculate amount that will appear against the term Stationery Used in the Income and Expenditure Account for the year ended 31st March, 2018:

Solution:

Question 21.
Calculate the amount that will be posted to the income and Expenditure Account for the year ended 31st March, 2018:

Solution:

Question 22.
How are the following dealt with while preparing the final accounts for the year ended 31st March, 2018?

Additional information:
(i) Sports Materials in Hand on 31st March, 2018 – ₹ 22,000
Solution:

Question 23.
How are the following dealt with while preparing the final accounts for the year ended 31st March, 2018?

Solution:

Question 24.
​How are the following dealt with while preparing the final accounts of a sports club for the year ended 31st March, 2018?.

Solution:

Question 25.
From the following information of a Not-for-Profit Organisation, show the Sports Materials item in the Income and Expenditure Account for the year ended 31st March, 2018 and Balance Sheets as at 31st March, 2018:

Solution:

Question 26.
The book value of furniture on 1st April, 2017 is ₹ 60,000. Half of this furniture is sold for ₹ 20,000 on 30th September, 2017. Depreciation is to be charged on furniture @ 10% p.a.
Calculate loss on sale of furniture. Show how the loss on sale and depreciation on furniture will be shown in the Income and Expenditure Account for the year ended 31st March, 2018.
Solution:

Question 27.
Delhi Youth Club has furniture at a value of ₹ 2,20,000 in its book on 31st March, 2017. It sold old furniture , having book value of ₹ 20,000 as at 1st April, 2017 at a loss of 20% on 31st December, 2017. Furniture is to be depreciated @ 10% p.a. Furniture costing ₹ 1,50,000 was also purchased on 1st October, 2017.
Prepare Furniture Account for the year ended 31st March, 2018.
Solution:

Question 28.
In the year ended 31st March, 2018, salaries paid amounted to ₹ 2,04,000. Ascertain the amount chargeable to the Income and Expenditure Account for the year ended 31st March, 2018 from the following additional information:

Solution:

Question 29.
How are the following items dealt with while preparing Income and Expenditure Account of a club for the year ended 31st March, 2018?

Locker Rent received during the year ended 31st March, 2018 – ₹ 52,000.
Solution:

Question 30.
Prepare Income and Expenditure Account for the year ended 31st March, 2018 from the following:

Solution:

Question 31.
Prepare Income and Expenditure Account from the following Receipts and Payments Account of Delhi Nursing Society for the year ended 31st March, 2018:

Donation of ₹10,000 received for Building Fund was wrongly included in the Subscriptions Account. A bill of medicines purchased during the year amounted to ₹12,800 was outstanding. Government Grant is not for a specific purpose.
Solution:

Question 32.
Following is the Receipts and Payments Account of You Bee Forty Club for the year ended 31st March, 2018:

Additional information:
(a) Outstanding Subscriptions for the year ended 31st March, 2018 – ​₹ 55,000.
(b) Outstanding Salaries and Wages – ₹ 40,000.
(c) Depreciate Sports Equipments by 25%.
Prepare Income and Expenditure Account of the club from the above particulars.
Solution:

Question 33.
From the following Receipts and Payments Account of Jaipur Sports Club, prepare Income and Expenditure Account for the year ended 31st March, 2018:

Solution:

Question 34.
Following is the Receipts and Payments Account of Delhi Football Club for the year ended 31st March, 2018:



Additional Information:
(i) During the year ended 31st March, 2018, the club had 550 members and each paying an annual subscription of ₹ 100.
(ii) Salaries Outstanding as at 1st April, 2017 were ₹ 10,000 and as at 31st March, 2018 were ₹ 5,000.
Prepare Income and Expenditure Account of the Club for the year ended 31st March, 2018.
Solution:

Question 35.
Following is the information given in respect of certain items of a Sports club. Show these items in the Income and Expenditure Account and the Balance Sheet of the club as at 31st March, 2018:

Solution:

Question 36.
Following is the summary of cash transactions of the Royal Club for the year ended 31st March, 2018:

In the beginning of the year, the club possessed Books of ₹ 2,00,000 and Furniture of ₹ 85,000. Subscriptions in arrears in the beginning of the year amounted to ₹ 3,500 and at the end of the year ₹ 4,500 and six months Rent ₹ 6,000 was due both in the beginning of the year and at the end of the year.
​Prepare Income and Expenditure Account of the club for the year ended 31st March, 2018 and ist Balance Sheet as at that date after writing off ₹ 5,000 and ₹ 11,300 on Furniture and books respectively.
Solution:

Question 37.
From the following Receipts and Payments Account of City Club and from the information supplied, prepare Income and Expenditure Account for the year ended 31st March, 2018 and Balance Sheet as at that date:

(a) The club has 50 members each paying an annual subscription of ₹ 500. Subscriptions Outstanding on 31st March, 2017 were ₹ 6,000.
(b) On 31st March, 2018, Salries Outstanding amounted to ₹ 2,000. Salaries paid in the year ended 31st March, 2018 included ₹ 6,000 for the year ended 31st March, 2017.
(c) On 1st April, 2017, the club owned Building valued at ₹ 2,00,000; Furniture ₹ 20,000 and Books ₹ 20,000.
(d) Provide depreciation on Furniture at 10%.
Solution:

Question 38.
From the following Receipts and Payments Account and additional information given below, prepare Income and Expenditure Account and Balance Sheet of Rural Literacy Society as on 31st March, 2018:

Additional information:
(i) Subscription outstanding as on 31st March, 2017 ₹ 20,000 and on 31st March, 2018 ₹ 15,000.
(ii) On 31st March, 2018, salary outstanding ₹ 6,000 and one month rent paid in advance.
(iii) On 1st April, 2017, society owned furniture ₹ 1,20,000 and books ₹ 50,000.
Solution:

Question 39.
Modern Club’s Balance Sheet as at 1st April, 2017 was as under:

The Receipts and Payments Account for the year ended 31st March, 2018 was:

Subscriptions still to be received are ₹ 5,500 but subscriptions already received include ₹ 4,000 for next year. Salaries still unpaid are ₹ 6,000. Sports Equipments are now valued at ₹ 45,000. Prepare Income and Expenditure Account and the Balance Sheet, after charging 10% depreciation on Billiards Tables.
Solution:

Question 40.
From the following information relating to the Ganesh Cricket Club, prepare Income and Expenditure Account for the year ended 31st March, 2018 and Balance Sheet as at that date. The summary of cash transactions is:

.
Subscriptions due on 31st March, 2018 amounted to ₹ 7,500. Write off 50% of Bats, Balls (not considering sale ) and 25% of Printing and Stationery.
Solution:

Question 41.
From the following Receipts and Payments Account of Mumbai Theatre Club, prepare Income and Expenditure Account for the year ended 31st March, 2018 and Balance Sheet as at that date.

Additional information:
(i) Subscriptions in arrear for the year ended 31st March, 2018 – ₹ 9,000 and subscriptions in advance for the year ended 31st March, 2019 – ₹ 3,500.
(ii) Insurance Premium outstanding ₹ 400.
(iii) Miscellaneous expenses prepaid ₹ 900.
(iv) 8% interest has accured oninvestment for five months.
(v) Billiard Table costing ₹ 3,00,000 was purchased during last year and ₹ 2,20,000 were paid for it.
Solution:

Question 42.
Following Receipts and Payments Account was prepared from the Cash Book of Delhi Charitable Trust for the year ending 31st March, 2018:

Prepare Income and Expenditure Account for the year ended 31st March, 2018 and Balance Sheet as on that date after the following adjustments:
(i) Insurance premium was paid in advance for three months.
(ii) Interest on investment ₹ 11,000 accrued was not received.
(iii) Rent ₹ 6,000; Salary ₹ 9,000 and advertisement expenses ₹ 10,000 outstanding as on 31st March, 2018.
Solution:

Question 43.
Given Below is the Receipts and Payments Account of a Mayur Club for the year ended 31st March, 2018:

Prepare club’s Income and Expenditure Account for the year ended 31st March, 2018 and Balance Sheet as at that date after taking the following information into account:
(i) There are 500 members, each paying an annual subscription of ₹ 500, ₹​ 5,000 are still in arrears for the year ended 31st March, 2017.
(ii) Municipal Taxes amounted to ₹​ 4,000 per year is paid up to 30th June and ₹​ 5,000 are outstanding of salaries.
(iii) Building stands in the books at ₹​ 5,00,000.
(iv) 6% interest has accrued on investments for five months.
Solution:

Question 44.
From the following information  and Receipts and Payments Account of Delhi Medical Society, prepare Income and Expenditure Account for the year ended 31st March, 2018 and Balance Sheet as at that date.



Other information:
On 31st March, 2017, the club possessed books of ₹ 2,00,000 and Furniture of ₹ 85,000. Provide depreciation on these assets @ 10% including the purchases during the year.
Subscriptions in arrears in the beginning of the year amounted to ₹ 3,500 and at the end of the year ₹ 5,500 were outstanding.
​The Club paid three months rent in advance both in the beginning and at the end of the year.
Solution:

Question 45.
From the following Receipts and Payments Account of Imran Khan club and from the given additional information, prepare Income and Expenditure Account for the year ending 31st December, 2015 and the Balance Sheet as at that date:

Additional Information:
(i) The club had received ₹ 20,000 for subscription in 2014 for 2015.
(ii) Salaries had been paid only for 11 months.
(iii) Stock of sports materials on 31st December, 2014 was ₹ 3,00,000 and on 31st December, 2015 ₹ 6,50,000.
Solution:

Question 46.
From the following particulars relating to the Ramakrishna Mission Charitable Hospital, prepare Income and Expenditure Account for the year ended
31st March, 2018 and Balance Sheet as at that date.


Solution:

Question 47.
Following is the Receipt and Payment Account of Women’s Welfare Club for the year ended 31st March, 2018:




Prepare Income and Expenditure Account for the year ended 31st March, 2018,and Balance Sheet as on that date.
Solution:

Question 48.
Receipts and Payments Account of Shankar Sports Club is given below, for the year ended 31st March, 2018:

Prepare Income and Expenditure Account and Balance Sheet with the help of following information:
Subscription outstanding on 31st March, 2017 is ₹ 1,200 and ₹ 2,300 on 31st March, 2018; opening stock of postage stamps is ₹ 300 and closing stock is ₹ 200; Rent ₹ 1,500 related to the year ended 31st March, 2017 and ₹ 1,500 is still unpaid. On 1st April, 2017 the club owned furniture ₹ 15,000, Furniture valued at ₹ 22,500 on 31st March, 2018. The club has a loan of ​₹ 20,000(@ 10% p.a.) which was taken in year ended 31st March, 2017.
Solution:

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