X, Y & Z are partners in a partnership firm. They decided to dissolve the firm for which firm borne the realisation expenses of ₹20,000. On the date of dissolution following information is available-
X's Capital = ₹5,00,000
Y's Capital = ₹5,00,000
Z's Capital = ₹3,00,000
Creditors = ₹2,00,000
Cash = ₹3,00,000
Profit and loss credit balance = ₹1,50,000
Loan to Y = ₹1,00,000
Land & building = ₹8,00,000
Investments = ₹2,00,000
Debtors = ₹1,00,000
Stock = ₹1,50,000
ADDITIONAL INFORMATION-
- Land & building sold at a profit of 12.5%.
- Debtors are realised at ₹90,000 whereas stock is realised at ₹1,40,000.
- X take over the investments for ₹1,90,000.
- All the creditors are paid by the firm on which firm got discount of 5%.
How much amount is realised from the assets?
Answer & explanation
Correct answer: option 1
The correct answer is option 1- ₹11,30,000
Land and building realised value = 9,00,000
Debtors realised = 90,000
Stock = 1,40,000
Total realised value = 9,00,000 + 90,000 + 1,40,000
= ₹11,30,000
** Land & building value = 8,00,000
Realised at profit of 12.5%
Profit = 8,00,000 x 12.5/100
= 1,00,000
Realised value = 8,00,000 + 1,00,000
= 9,00,000
Note: Investments ₹2,00,000 (taken over by partner X for ₹1,90,000). → This is not a sale, it is a transfer to a partner, so it is not included in realisation of assets.