Dissolution of Partnership Test

Question 1
1 / -0

Following accounts will be shown on debit side of Realisation Account except

A
Cash Received from Sale of Assets

B
Realisation Expenses

C
If any partner has taken over any liability,

D
Cash Payments of Liabilities

Question 2
1 / -0

At the time of dissolution, there was an unrecorded asset i.e. Laptop, market price of which was ₹24,000. This laptop was taken by a partner (Mohan) at 50% of the market price. Give journal entry for the same.

A

Mohan’s Capital A/c Dr. To Realisation Account 12,000 12,000

B

Bank A/c            Dr.     To Office Equipment A/c 10000 10000

C

Realisation A/c Dr. 12,000 To Mohan’s Capital A/c    12,000 12,000

D

Mohan’s Capital A/c Dr.    To Bank A/c 12,000 12,000

Question 3
1 / -0

One Creditor worth ₹4,500 took over stock valued at Rs.5,200 in full satisfaction of his claim.

A

Creditors A/c   Dr. To Assets A/c       5,400 5,400

B

Creditors A/c   Dr. To Bank A/c          4,500 4,500

C

Creditors A/c   Dr.        To Realisation A/c    4,500 4,500

D
No Entry is required

Question 4
1 / -0

Total creditors of the firm (already transferred to Realisation Account) were ₹30,000. Out of this, creditors waived their claim of ₹5,000 while the rest agreed to allow discount @ 10% of their respective claim.

A

Realisation A/c   Dr.     To Bank A/c          22,500 22,500

B

Bank A/c            Dr.      To Realisation A/c 22,500 22,500

C

Realisation A/c   Dr.    To Bank A/c   25,000 25,000

D

Bank A/c            Dr.   To Realisation A/c 25,000 25,000

Question 5
1 / -0

How goodwill account appear in the Balance sheet be treated in case of dissolution of firm

A
Transferred to capital account at market value

B
Transferred to realization account at book value

C
Transferred to realization account at market value

D
Transferred to capital account at book value

Question 6
1 / -0

What journal entry will take place when amount of liability is less than the amount of workmen compensation reserve?

A
Workmen Compensation Reserve A/c Dr.
To Bank A/c
To Partner’s Capital A/c

B
Realisation A/c Dr.
To Workmen Compensation Reserve

C
Realisation A/c Dr.
To Partners Capital A/cs
To Workmen Compensation Reserve

D
Workmen Compensation Reserve A/c Dr.
To Realisation A/c
To Partner’s Capital A/c

Question 7

1 / -0

Match the following

When assets are sold for cash

(i)Bank A/cDr

To Realisation A/c

When an asset is taken over by a partner

(ii)No entry

When the assets are given to any of the creditors towards the payment of his dues

(iii) Partner CapitalA/cDr

To Realisation A/c

Choose the correct option from below

a(i), b(ii), c(iii)

a(iii), b(ii), c(i)

a(i), b(iii), c(ii)

a(ii), b(iii), c(i)

Question 8
1 / -0

What is the accounting treatment of Investment Fluctuation Fund when it is given in the Balance sheet

A
Crediting Investment Fluctuation Fund A/c and debiting Partners Capital A/cs

B
Debiting Bank account and crediting Realisation account

C
Debiting Realisation account and crediting Investment Fluctuation Fund account

D
Debiting Investment Fluctuation Fund account and crediting Realisation account

Question 9
1 / -0

What journal entry will take place when loan of partner ₹60,000 is paid at the time of dissolution?

A
Partner’s Capital A/c Dr.
To Cash/Bank A/c

B
Cash/Bank A/c Dr
To Realisation A/c

C
Partner’s Loan A/c Dr.
To Cash/Bank A/c

D
Realisation A/c Dr.
To Cash/Bank A/c

Question 10
1 / -0

At the time of dissolution, partner’s loan account is not transferred to _____ account but is retained as a separate account.

A
Revaluation Account

B
Partner’s Capital account

C
Profit and Loss account

D
Realisation account

Submit Test

Dissolution of ...

Question 1

Cash Received from Sale of Assets

Realisation Expenses

If any partner has taken over any liability,

Cash Payments of Liabilities

Question 2

Mohan’s Capital A/c Dr. To Realisation Account 12,000 12,000

Bank A/c Dr. To Office Equipment A/c 10000 10000

Realisation A/c Dr. 12,000 To Mohan’s Capital A/c 12,000 12,000

Mohan’s Capital A/c Dr. To Bank A/c 12,000 12,000

Question 3

Creditors A/c Dr. To Assets A/c 5,400 5,400

Creditors A/c Dr. To Bank A/c 4,500 4,500

Creditors A/c Dr. To Realisation A/c 4,500 4,500

No Entry is required

Question 4

Realisation A/c Dr. To Bank A/c 22,500 22,500

Bank A/c Dr. To Realisation A/c 22,500 22,500

Realisation A/c Dr. To Bank A/c 25,000 25,000

Bank A/c Dr. To Realisation A/c 25,000 25,000

Question 5

Transferred to capital account at market value

Transferred to realization account at book value

Transferred to realization account at market value

Transferred to capital account at book value

Question 6

Workmen Compensation Reserve A/c Dr. To Bank A/c To Partner’s Capital A/c

Realisation A/c Dr. To Workmen Compensation Reserve

Realisation A/c Dr. To Partners Capital A/cs To Workmen Compensation Reserve

Workmen Compensation Reserve A/c Dr. To Realisation A/c To Partner’s Capital A/c

Question 7

a(i), b(ii), c(iii)

a(iii), b(ii), c(i)

a(i), b(iii), c(ii)

a(ii), b(iii), c(i)

Question 8

Crediting Investment Fluctuation Fund A/c and debiting Partners Capital A/cs

Debiting Bank account and crediting Realisation account

Debiting Realisation account and crediting Investment Fluctuation Fund account

Debiting Investment Fluctuation Fund account and crediting Realisation account

Question 9

Partner’s Capital A/c Dr. To Cash/Bank A/c

Cash/Bank A/c Dr To Realisation A/c

Partner’s Loan A/c Dr. To Cash/Bank A/c

Realisation A/c Dr. To Cash/Bank A/c

Question 10

Revaluation Account

Partner’s Capital account

Profit and Loss account

Realisation account

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Question Analysis

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Workmen Compensation Reserve A/c Dr.
To Bank A/c
To Partner’s Capital A/c

Realisation A/c Dr.
To Workmen Compensation Reserve

Realisation A/c Dr.
To Partners Capital A/cs
To Workmen Compensation Reserve

Workmen Compensation Reserve A/c Dr.
To Realisation A/c
To Partner’s Capital A/c

Partner’s Capital A/c Dr.
To Cash/Bank A/c

Cash/Bank A/c Dr
To Realisation A/c

Partner’s Loan A/c Dr.
To Cash/Bank A/c

Realisation A/c Dr.
To Cash/Bank A/c