Rose and Lily shared profits in the ratio of 2 3 Their Balance Sheet on March 31 2017 was as f...........

Rose and Lily shared profits in the ratio of 2:3. Their Balance Sheet on March 31, 2017 was as follows: (5 marks)

Balance Sheet of Rose and Lily as on March 31, 2017

Liabilities Amount

Assets Amount

Creditors 40,000 Cash 16,000 Lily’s loan 32,000 Debtors 80,000 Profit and Loss 50,000 Less: Provision for doubtful Debts 3,600 76,400 Capitals: Lily 1,60,000 Inventory 1,09,600 Rose 2,40,000 Bills Receivable 40,000 Buildings 2,80,000 5,22,000 5,22,000

Rose and Lily decided to dissolve the firm on the above date. Assets (except bills receivables) realised Rs 4, 84,000. Creditors agreed to take Rs 38,000. Cost of Realisation was Rs 2,400. There was a Motor Cycle in the firm which was bought out of the firm’s money, was not shown in the books of the firm. It was now sold for Rs 10,000. There was a contingent liability in respect of outstanding electric bill of Rs 5,000, Bill Receivable taken over by Rose at Rs 33,000.

Show Realisation Account, Partners Capital Account, Loan Account and Cash Account.

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