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

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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

DateParticularsL.F.
Amount
(Dr.)
Amount
(Cr.)
Realisation A/cDr.1,00,000
    To Asset A/c1,00,000
(Sundry asset are written off in Realisation A/c)
Atual’s Capital A/cDr.40,000
   To Realisation A/c40,000
( 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/cDr.26,000
    To Realisation A/c26,000
(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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