Why loan account is transferd to capital account?
Why loan account is transferd to capital account? would finally be settled among the partners.
(Ans.: Loss on Realisation—t 3,000; cash paid to A, B and 25,000; 28,000; 78,000
30. Yogeshand Naresh were partners sharing profits equally-They dissolved the firm on 1 st April, 2019.Nare
was assigned the responsibility to realise the assets and pay the liabilities at a remuneration of R
including expenses. Balance Sheet of the firm as on that date was as follows:
32.
Liabilities
Creditors
Bills Payable
NareshS Loan
Mrs. YogesWs Loan
Investment Fluctuation Reserve
Capital A/cs:
Yogesh
Naresh
40,000
40,000
44,000
42,000
8,000
42,000
Assets
Cash/Bank
Investments
Debtors
Less: Provision for Doubtful Debts
Bills Receivable
Profit and Loss A/c
.L
40000
4,000
6.0
36,
334
toar
21,000
21,000
The firm was dissolved on following terms:
(a) Yogesh was to pay his wife's loan.
(b) Debtors realised 30,000.
(c) Naresh was to take investments at an agreed value oft 26,000.
(Y Creditors and Bills Payable were payable after two months but were paid immediately at a
of 15% p.a.
e) Bills Receivable were received allowing 5% rebate.
(f) A Debtor previously written off as Bad Debt paid 15,000.
(g) A? unrecorded asset realised 10,000.
Prepare*ealisation Account, Partner's Capital Accounts, Partner's Loan Account and Cash/Bank
[Ans.: Realisation Gain—t 13,330; Final Payment to Yogesh—? 14,365; Naresh—Nil; Loan of
transferred to Naresh& Capital A/c—? 43,635; Repayment of Loan—
