P Q and R were partners in a firm sharing profits and losses in the ratio of 5 3 2 They agreed to di......

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Accountancy ( 12th) Dissolution of Partnership Firm Add to Study Deck

P, Q and R were partners in a firm sharing profits and losses in the ratio of 5 : 3 : 2. They agreed to dissolve their partnership firm on 31st March, 2019. P was deputed to realise the assets and pay the liabilities. He was paid 1,000 as commission for his services. The financial position of the firm was:

Balance Sheet as at 31st March, 2019

Liabilities	Amount	Assets		Amount
Creditors	10,000	Stock		5,500
Bills Payable	3,700	Investments		15,000
Investments Fluctuation Reserve	4,500	Debtors	7,100
Capital A/cs:		Less: Provision for Doubtful Debtors	450	6,650
P 37,550		Cash		5,600
Q 15,000	52,550	R's Capital A/c		8,000
		Plant and Machinery		30,000
	70,750			70,750

P took over Investments for 12,500. Stock and Debtors realised 11,500. Plant and Machinery were sold to Q for 22,500 for cash. Unrecorded assets realised 1,500. Realisation expenses paid amounted to 900.

Prepare necessary Ledger Accounts to close the books of the firm.

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