Class 12 Accountancy - Chapter Dissolution of a Partnership Firm NCERT Solutions | How deficiency of crditors is paid off a
How deficiency of crditors is paid off at the time of dissolution of firm.
For settlement with the creditor through transfer of assets when a creditor
accepts an asset in full and final settlement of his account, journal entry needs to be recorded. But, if the creditor accepts an asset only as part payment of his/her dues, the entry will be made for cash payment only. For example, a creditor to whom Rs. 10,000 was due accepts office equipment worth Rs 8,000 and is paid Rs. 2,000 in cash, the following entry shall be made for the payment of Rs. 2,000 only.
Realisation A/c Dr.
To Bank A/c
However, when a creditor accepts an asset whose value is more than the amount due to him, he/she will pay cash to the frim for the difference for which the entry will be:
Bank A/c Dr
To Realisation A/c
(For payment of realisation expenses )
(a) When some expenses are incurred and paid by the firm in the process of
realisation of assets and payment of liabilities: 12
Realisation A/c. Dr.
To Bank A/c
More Questions From Class 12 Accountancy - Chapter Dissolution of a Partnership Firm
- Q:-
State the difference between dissolution of partnership and dissolution of partnership firm.
- Q:-
On dissolution, how will you deal with partner’s loan if it appears on the
(a) assets side of the balance sheet, (b) liabilities side of balance sheet. - Q:-
State the accounting treatment at the time of dissolution of a firm for:
i. Unrecorded assets ii. Unrecorded liabilities - Q:-
What is a Realisation Account?
- Q:-
Reproduce the format of Realisation Account.
- Q:-
State the order of settlement of accounts on dissolution.
- Q:-
On what account realisation account differs from revaluation account.
- Q:-
Distinguish between firm’s debts and partner’s private debts.
- Q:-
Explain the process dissolution of partnership firm?
Popular Questions of Class 12 Accountancy
- Q:-
Mohan and Shyam are partners in a firm. State whether the claim is valid if the partnership agreement is silent in the following matters:
(i) Mohan is an active partner. He wants a salary of Rs. 10,000 per year;
(ii) Shyam had advanced a loan to the firm. He claims interest @ 10% per annum;
(iii) Mohan has contributed Rs. 20,000 and Shyam Rs. 50,000 as capital. Mohan wants equal share in profits.
(iv) Shyam wants interest on capital to be credited @ 6% per annum. - Q:-
Identify various matters that need adjustments at the time of admission of a new partner.
- Q:-
What are the different ways in which a partner can retire from the firm?
- Q:-
State whether the following statements are true or false:
(i) Valid partnership can be formulated even without a written agreement between the partners;
(ii) Each partner carrying on the business is the principal as well as the agent for all the other partners;
(iii) Maximum number of partners can be 50;
(iv) Methods of settlement of dispute among the partners can’t be part of the partnership deed;
(v) If the deed is silent, interest at the rate of 6% p.a. would be charged on the drawings made by the partner;
(vi) Interest on partner’s loan is to be given @ 12% p.a. if the deed is silent about the rate. - Q:-
Why it is necessary to ascertain new profit sharing ratio even for old partners when a new partner is admitted?
- Q:-
Write the various matters that need adjustments at the time of retirement of partner/partners.
- Q:-
What is sacrificing ratio? Why is it calculated?
- Q:-
On what occasions sacrificing ratio is used?
- Q:-
If some goodwill already exists in the books and the new partner brings in his share of goodwill in cash, how will you deal with existing amount of goodwill?
- Q:-
Why there is need for the revaluation of assets and liabilities on the admission of a partner?
Recently Viewed Questions of Class 12 Accountancy
- Q:-
List the items which may be debited or credited in capital accounts of the partners when:
(i) Capitals are fixed.
(ii) Capital are fluctuating. - Q:-
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- Q:-
Give two circumstances under which the fixed capitals of partners may change.
- Q:-
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- Q:-
If some goodwill already exists in the books and the new partner brings in his share of goodwill in cash, how will you deal with existing amount of goodwill?
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Define Partnership Deed.
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