Dissolution Of Partnership Firm Class 12 Accountancy Exam Questions

Please refer to Dissolution Of Partnership Firm Class 12 Accountancy Exam Questions provided below. These questions and answers for Class 12 Accountancy have been designed based on the past trend of questions and important topics in your class 12 Accountancy books. You should go through all Class 12 Accountancy Important Questions provided by our teachers which will help you to get more marks in upcoming exams.

Class 12 Accountancy Exam Questions Dissolution Of Partnership Firm

Class 12 Accountancy students should read and understand the important questions and answers provided below for Dissolution Of Partnership Firm which will help them to understand all important and difficult topics.

VERY SHORT ANSWER TYPE QUESTIONS :

Question. What journal entry will you pass when an asset is given away to any of the Firms creditors towards full payment of dues?
Answer : No Entry

Question. Name the Asset that is not transferred to the Realisation account, but bring certain amount of cash against its disposal at the time of dissolution of the Firm?
Answer : Unrecorded Asset

SHORT ANSWER TYPE QUESTIONS :

Question. A & B share profits and losses in the ratio 3:2. They have decided to dissolve the firm. Assets and external liabilities have been transferred to Realisation A/c. Pass the journal entries to effect the fol-lowing:
a) Bank Loan of Rs 12,000 is paid off
b) A was to bear all expenses of realization for which he is given a commission ofRs 400.
c) Deferred Advertisement Expenditure A/c appeared in the books at Rs 28,000.
d) Stock worth Rs 1,600 was taken over by B at Rs 1,200.
e) An unrecorded computer realized Rs 7,000.
f) There was an outstanding bill of repairs for Rs 2,000 which was paid off.
Answer : 

Question. Pass necessary journal entries to record the following at the time of dissolution of the partnership firm assuming that the Assets and third party liabilities have already been transferred to Realisation A/c:
a) An unrecorded asset of Rs 300 was taken over by A, one of the partners
b) Creditors were paid Rs 14,000 in full settlement of their claims for Rs 15,000
c) Sundry assets realized Rs 1,95,000
d) B (another partner) was to bear the expenses on dissolution, which amounted Rs 1,500
e) Value of Sundry liabilities including creditors at the time of dissolution was Rs 1,90,000
f) A take over the loan payable to MrsA Rs 15,000
Answer : 

Question. ZENIT and JANET are two partners sharing profits in the ratio 2:1. Give the journal at the time of dissolution in the following cases:
i) Deferred revenue advertising expenditure appeared at Rs 30,000
ii) Profit & Loss A/c was appearing on the asset side of the Balance Sheet at Rs 60,000
iii) An unrecorded investment realized Rs 6,000
iv) Partner ZENIT paid to a creditor Rs 20,000
Answer :

Question. Manu and Nandu were partners sharing profits in the ratio of 3:2. Pass journal entries under the following situations at the time of dissolution of Firm:
(a) Workmen Compensation Reserve stood at Rs. 1,00,000 and there was no liability towards Workmen Compensation.
(b) Workmen Compensation Reserve stood at Rs.1,00,000 and liability in respect of it was as-certain at Rs.75,000.
(c) Workmen Compensation Reserve stood at Rs.1,00,000 and liability in respect of it was as-certained at Rs. 1,20,000.
(d) Workmen Compensation Reserve stood at Rs. 1,00,000 and liability in respect of it was ascertained at Rs. 1,00,000.
Answer : 

Question. The book value of assets other than cash and bank transferred to realization account is Rs 1,00,000. 50% of the assets are taken over by a partner Atul, at a discount or 20%. 40% of the remaining assets are sold at a profit of 30% on cost; 5% of the balance being obsolete, realized nothing and remaining assets are handed over to a creditor, in full settlement of his claim. You are required to record the journal entries for realization of assets 
Answer : 

Question. Rohit and Suresh are in partnership sharing profit in the ratio 2:3. On March 31.2005, they agree to dissolve the business. Pass necessary journal entries at the time of dissolution to record the follow-ing:
a) Realisation expenses amounted to Rs 2000
b) Deferred revenue advertising expenditure appeared in the books at Rs 60,000
c) P & L A/c on the asset side of the balance sheet was Rs 30,000
d) An unrecorded asset of Rs 3,000 was taken over by Suresh
e) Liabilities amounting to Rs 24,000 already transferred to Realisation account, was settled at Rs 22,000.
f) Loan to Rohit was adjusted through his Capital A/c Rs 15,000
Answer : 

Question. What journal entries would be passed for the following transactions on the dissolution of a firm, after various assets (other than cash) and third party liabilities have been transferred to Realisation A/c:
i) Stock worth Rs 15,000 is taken over by partner A
ii) Compensation to employees paid by the firm amounting to Rs 20,000
iii) Sundry creditors amounted to Rs 8,000. They were paid at a discount of 5%
iv) There was an unrecorded asset of Rs 2,000 which was taken over by B at Rs 1,500
v) Profit on Realisation Rs 21,000 was to be distributed between A and B in the ratio 4:3
Answer : 

Question. Record necessary journal entries in the following cases:
a) Creditors worth Rs 85,000 accepted Rs 40,000 as cash and investment worth Rs 43,000 in full settlement of their claim
b) Creditors were Rs 16,000. They accepted machinery valued at Rs 18,000 in settlement of their claim
c) Creditors were Rs 90,000. They accepted buildings valued at Rs 1,20,000 and paid cash to the firm Rs 30,000
Answer : 

Question. Record necessary journal entries to record the following unrecorded assets and liabilities in the books of Paras and Priya:
i) There was an old furniture in the firm which had been written off completely in the books. This was sold for Rs 3,000
ii) Ashish, an old customer whose account for Rs 1,000 was written off as bad in the previ-ous year, paid 60% of the amount.
iii) Paras agree to take over the firm’s goodwill (not recorded in the books of the firm) for a valuation of Rs 30,000
iv) There was an old typewriter which had been written off completely from the books. It was estimated to realize Rs 400. It was taken away by Priya at an estimated price less 25%
v) There were 1000 shares of Rs 10 each in Star Limited acquired at a cost of Rs 2000 which had been written off completely from the books. These shares are valued at Rs 6 each and divided among the partners in their profit sharing ratio
Answer : 

Question. Pass the necessary Journal entries for the following transactions on the dissolution of the firm T and p after the various assets (other than cash) and outside liabilities have been transferred to Realisation Account:
i) Bank Loan Rs 34,000 was paid
ii) Furniture work Rs 70,000 was taken over by partner T at Rs 43,000
iii) Partner P agreed to pay creditor Rs 7,500
iv) A computer previously written off fully realized Rs 3,900
v) Expenses on realization s 3,200 was paid by partner T
vi) Profit on realization Rs 4,800 was distributed between T and P in 5:3 ratio
Answer : 

Question. Pass necessary journal entries for the following transactions on the dissolution of the firm of Sudha and Shiva after the various assets (other than cash) and liabilities were transferred to Realisation A/c:
i) Sudha agreed to pay off her husband’s loan Rs 19,000
ii) A debtor whose debt of Rs 9,000 was written off in the books paid Rs 7,500 in full settlement
iii) Shiva took over all investments at Rs 13,300
iv) Sundry creditors Rs 10,000 was paid at 9% discount
v) Realisation expenses Rs 3.400 were paid by Sudha for which she was allowed Rs 3,000
vi) Loss on realization Rs 9,400 was divided between Sudha and Shiva in 3:2 ratio 
Answer : 

Question. Disha, Mohit and Nandan are partners. They decided to dissolve the firm. Pass necessary journal entries for the following after the various assets (other than cash and bank) and outside liabilities have been transferred to Realisation Account:
a) Ann old typewriter which was not recorded in the books was sold for Rs 2,000 whereas the expected value was Rs 5,000
b) Stock of Rs 70,000 was taken by Disha at a discount of 30%
c) Total creditors of the firm were Rs 20,000. A creditor for Rs 2,000 was untraceable and other creditors accepted payment allowing 10% discount.
d) Mohit paid realization expenses of Rs 18,000 out of his private funds, who was to be paid remuneration of Rs 13,000 for completing the dissolution process and was responsible to bear all the realization expenses.
e) Nandan had taken a loan of Rs 50,000 from the firm, which was paid fully by him to the firm
f) Rs 12,000 were recovered from a debtor which was written off as Bad Debts last year.
Answer : 

LONG ANSWER TYPE QUESTIONS :

Question. Arun and Tarun were partners sharing profit and losses in the ratio 3:2. They decided to dissolve the firm on 31.3.2019, when their balance sheet was as under:

The firm was dissolved on 1.4.2019 on the following terms: 
a) Arun took over the investment at Rs 8,000 and agreed to pay off the loan of his wife
b) The assets realized as follows: Stock Rs 2,000, Debtors Rs 20,500, Furniture Rs 1,000 more than its book value, Plant Rs 20,000 less than its book value.
c) Expenses of realization were Rs 1,200
d) Creditors were paid off at a discount of 3%
e) Firm had an unrecorded asset which was valued at Rs 5,000 which was accepted by unrecorded liability of Rs7,000, in full settlement of their claims
Prepare the Realisation A/C, Partner’s Capital Accounts and Bank A/C to close the books of the firm.
Answer : 

Question. Amit and Sumit were partners sharing profit and losses in the ratio 3:2. They decided to dissolve the firm on 31.12.2014, when their Balance Sheet was as under:

The firm was dissolved on the following terms:
a) Assets were realized as follows: Debtors Rs 1,800 and Stock Rs 2,800
b) Machinery was sold for Rs 20,000 at commission of 10%
c) Amit took over the investments at an agreed value of Rs 3,800
d) Creditors of the firm agreed to accept 5% less
e) Expenses of Realisation amounted Rs 400
f) An unrecorded furniture is sold for Rs 10,000
Prepare Realisation A/C, Partner’s Capital Accounts and Bank A/C to close the books of the firm.
Answer : 

Question. Parul, Payal and Priyanka are partners. They decided to dissolve the firm. Pass necessary journal en-tries for the following after the various assets (other than cash and Bank) and outside liabilities have been transferred to Realisation Account:
a) There were total debtors of Rs 76,000. A provision of Bad and Doubtful Debts also stood in the books at Rs 6,000. Rs 12,000 debtors proved bad and rest paid the amount due
b) Parul agreed to pay off her husband’s loan of Rs 7,000 at a discount of 5%
c) Total creditors of the firm were Rs 40,000. Creditors worth Rs 10,000 were given a piece of furniture costing Rs 8,000 in full and final settlement. Remaining creditors allowed a discount of 10%
d) Payal had given a loan of Rs 70,000 to the firm which was duly paid
e) A contingent liability (not provided for) of Rs 4,000 was also discharged
f) The firm had a debit balance of Rs 27,000 in the Profit & Loss A/C on the date of dissolu-tion
Answer : 

Question. A, B and C were partners sharing profit in the ratio 3:1:1. Their Balance Sheet 31.3.2019, the date on which they dissolve their firm, was as follow:
BALANCE SHEET AS ON 31.3.2019

It was agreed that:
a) A to take over Bills receivable at Rs 800, debtors amounting to Rs 20,000 at Rs 17,200 and the Creditors of Rs 6,000 were to be paid by him at this figure.
b) B to take over all Stock for Rs 7,000 and some Sundry assets at Rs 7,200 (being 10% less than the book value)
c) C to take over remaining sundry assets at 90% of the book value and assume the respon-sibility of discharge of loan together with accrued interest of Rs 300. The remaining debtors were sold to a debt collecting agency at 50% of the book value.
d) The expenses of realization were Rs 270.
Prepare Realisation A/c, Partner’s Capital A/c and Cash A/C
Answer : 

Question. X and Y were partners sharing profit and losses in the ratio 3:2. The partners decided to dissolve the firm. Their Balance sheet as on 31.3.2021 was as under:

Following transactions took place:
a) Motor Vehicles and Stock were sold for cash at Rs 16,950 and Rs 77,600 respectively. Debtors were realized in full.
b) X took over the Land and Building at an agreed valuation of Rs 43,500
c) Creditors were paid off subject to discount of Rs 1,700
d) Expenses for realization were Rs 1,250
Prepare the Realisation Account, partner’s Capital Accounts and Bank Account to close the books of the firm.
Answer : 

Question. A, B and C were partners sharing profits and losses in the ratio 2:1:1. The partners decided to dissolve the firm. Their Balance Sheet as at 31.3.2020 was as under:

Following transactions took place
a) The assets realised Goodwill Rs 20,000, Land and Building Rs 1,00,000, Plant and machinery Rs 50,000, Motor car Rs 25,000 and Debtors Rs 24,000
b) Realisation expenses were Rs 2,000
Prepare the Realisation A/C,Partner’s Capital Accounts and Cash A/C to close the books of the firm.
Answer : 

Question. A, B and C who share profits in the ratio 3:3:1 agreed upon the dissolution of their partnership firm on 31.3.2014, at which date their Balance Sheet was as under:

Following transactions took place:
a) The investments were taken over by A for Rs 17,500. A also agreed to discharge his wife’s loan. B took over stock at Rs 7,500.
b) Machinery realized Rs 65,000 and debtors realized 50% of their book value
c) The expenses of realization amounted to Rs 500.
Prepare the Realisation Account, Partner’s Capital Accounts and Bank Account to close the books of the firm.
Answer : 

Question. Following is the Balance Sheet of Ramesh and Suresh as at 30.3.2021:

On the above date Suresh and Ramesh decided to dissolve the firm. Ramesh took over the credi-tors and Suresh took over the Bills payable. Assets realized as follows:
a) Debtors Rs 9,000, Furniture Rs 21,000, Stock Rs 6,000, Truck Rs 32,000 and Land and Building Rs 60,000.
b) Expenses on Realisation paid by Ramesh were Rs 1,200.
Prepare Realisation Account, Cash Account and Capital Accounts of the Partners to close the books of the firm.
Answer :