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

Solution: In the Books of Fox and Wolf
Dr. REALISATION ACCOUNT Cr.
Particulars ` Particulars `
To Sundry Assets (Transfer): By Sundry Liabilities (Transfer):
Stock A/c 18,000 Creditors A/c 88,500
Debtors A/c 42,000 Bills Payable A/c 23,000
Furniture A/c 12,000 Ms. Wolf’s Loan A/c 40,000 1,51,500
Machinery A/c 1,06,500 1,78,500 By Bank A/c (Assets Realised):
To Bank A/c (Liabilities Paid): Stock 10,500
Bills Payable 23,000 Debtors 27,750
Creditors 86,730 Machinery 88,500 1,26,750
Ms. Wolf’s Loan 38,500 By Fox’s Capital A/c (Furniture Taken Over) 7,500
Claim for Damages 2,000 1,50,230 By Bank A/c (Recovery of Bad Debts) 1,800
To Bank A/c (Expenses) 2,100 By Loss on Realisation:
Fox’s Capital A/c 21,640
Wolf’s Capital A/c 21,640 43,280
3,30,830 3,30,830
Dr. PARTNERS’ CAPITAL ACCOUNTS Cr.
Particulars Fox (`) Wolf (`) Particulars Fox (`) Wolf (`)
To Profit and Loss A/c 11,250 11,250 By Balance b/d 30,000 24,000
To Realisation A/c 7,500 ... By Bank A/c 10,390 8,890
(Furniture Taken Over) (Balancing Figure)
To Realisation A/c (Loss) 21,640 21,640
40,390 32,890 40,390 32,890

Dr. BANK ACCOUNT Cr.
Particulars ` Particulars `
To Balance b/d 4,500 By Realisation A/c (Liabilities Paid) 1,50,230
To Realisation A/c: By Realisation A/c (Expenses) 2,100
Assets Realised 1,26,750
Recovery of Bad Debts 1,800 1,28,550
To Fox’s Capital A/c (Cash Brought in) 10,390
To Wolf’s Capital A/c (Cash Brought in) 8,890
1,52,330 1,52,330
Notes: 1. Profit-sharing ratio is not given. Therefore, profits/losses shall be shared equally.
2. Claim for damages was ` 4,000 but it was settled for ` 2,000. Therefore, payment of ` 2,000 shall
be debited to Realisation Account.
Illustration 2.
X, Y and Z are sharing profits as 2 : 3 : 5 and their Balance Sheet as at 31st March, 2018
is as follows:
BALANCE SHEET as at 31st March, 2018
Liabilities ` Assets `
Capital A/cs: Building 10,00,000
X 3,50,000 Equipments 2,00,000
Y 4,50,000 Stock 8,00,000
Z 5,50,000 13,50,000 Sundry Debtors 6,00,000
Sundry Creditors 3,00,000 Cash at Bank 3,00,000
Bank Loan 6,00,000
X’s Loan 6,50,000
29,00,000 29,00,000