The Book Value Of Assets (Other Than Cash And Bank) Transferred To Realisation Account Is Rs 1,00,000-Solution

Q.7. The book value of assets (other than cash and bank) transferred to Realisation Account is Rs 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.

SOLUTION

Journal

Date	Particulars		L.F.	Amount (Dr.)	Amount (Cr.)
	Realisation A/c	Dr.		1,00,000
	To Asset A/c				1,00,000
	(Sundry asset are written off in Realisation A/c)
	Atual’s Capital A/c	Dr.		40,000
	To Realisation A/c				40,000
	( 50% of the assets are taken over by a partner Atul, at a discount of 20%, Rs 50,000 X 20/100 =Rs 10,000)
	Bank A/c	Dr.		26,000
	To Realisation A/c				26,000
	(Asset sold Rs 50,000 ‘s 40%=50,000 X 40/100 = Rs.20,000 + 30% Profit = Rs.20,000 X 30/100 = 6,000,20,000+6,000=26,000)
	No entry is passed since creditors are handed over obsolete assets in full settlement of their claim.

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