Page 160 - ISCDEBK-12

6.34 Double Entry Book Keeping (Section A)—ISC XII

Dr. BANK ACCOUNT Cr.
Particulars ` Particulars `
To Balance b/d 3,720 By Realisation A/c (Creditors Paid) 14,000
To Elephant Ltd. 16,000 By Cat’s Capital A/c (Final Payment) 19,440
To Realisation A/c (Debtors Realised) 19,200 By Rat’s Capital A/c (Final Payment) 5,480
38,920 38,920

STATEMENT SHOWING DISTRIBUTION OF EQUITY AND PREFERENCE SHARES
Particulars Total Cat Rat
` ` `
(i) Preference Shares of Elephant Ltd. 160 Preference Shares of ` 100 each,
valued @ ` 75 each 12,000
Less: Preference Shares allotted to Rat against his Loan 3,000
Balance Distributed between Partners equally against Capital 9,000 4,500 4,500
(ii) Equity Shares of Elephant Ltd. 1,600 shares of ` 10 each, valued @ ` 12.5
per share distributed in the ratio of capitals, i.e., 24,000 : 8,000 or 3 : 1. 15,000 5,000

Unsolved Questions

1. Following is the Balance Sheet as at 31st March, 2018 of A, B and C carrying on business in partnership
sharing profits and losses in the ratio of 2 : 2 : 1:

Liabilities ` Assets `
Capital A/cs: Fixed Assets 10,50,000
A 6,00,000 Sundry Debtors 4,50,000
B 3,75,000 9,75,000 Stock 1,50,000
Mortgage Loan 6,00,000 Cash at Bank 75,000
Reserve 90,000 C’s Capital A/c 90,000
Sundry Creditors 1,50,000
18,15,000 18,15,000

They decided to dissolve the partnership and the following arrangements were agreed upon:
(i) Fixed assets included:
(a) Machinery ` 82,500 taken by B at an agreed value of ` 1,35,000 after the repairing costs
amounted to ` 30,000 to be borne by the firm.

(b) Land and Building ` 7,50,000 taken by A at an agreed value of ` 9,00,000 subject to the
mortgage loan to be taken over at ` 6,00,000.
(ii) Other assets (excluding Cash at Bank) and Creditors are taken over by Welfare Limited in
consideration of issue of 5,000 debentures of ` 150 each fully paid. These debentures are taken
over at a total agreed value of ` 7,20,000 equally by A and B.

(iii) Creditors for ` 37,500 not provided for in the books had to be paid.
Prepare Realisation Account, Partners’ Capital Accounts, Bank Account assuming that the final settlement
was made by the partners bringing in the amounts due from them.