3) Partner allowed remuneration of ₹7000 for looking the dissolution process whereas actual expenses paid by partner of ₹4000
c) i) Realisation A/c Dr. ₹7000
To Partner's capital A/c ₹7000
ii) Partner's capital A/c Dr. ₹4000
To Bank A/c ₹4000
4) Partner allowed remuneration of ₹7000 for looking the dissolution process whereas actual expenses paid by firm of ₹4000
d) Realisation A/c Dr. ₹7000
To Partner's capital A/c ₹7000
Options:
1-a, 2-b, 3-d, 4-c
1-a, 2-b, 3-c, 4-d
1-b, 2-a, 3-c, 4-d
1-b, 2-a, 3-d, 4-c
Correct Answer:
1-a, 2-b, 3-d, 4-c
Explanation:
* For payment of realisation expenses: (a) When some expenses are incurred and paid by the firm in the process of realisation of assets and payment of liabilities: Realisation A/c Dr. To Bank A/c (b) When realisation expenses are paid by a partner on behalf of the firm: Realisation A/c Dr. To Partner’s Capital A/c (c) When a partner has agreed to bear the realisation expenses: (i) if payment of realisation expenses is made by the firm- Partner’s Capital A/c Dr. To Bank A/c (ii) if the partner himself pays the realisation expenses, no entry is required Note: In the absence of information about who is paying the expenses, it is implied that expenses are paid by the partner who has agreed to bear expenses. * For agreed remuneration to such partner who agrees to undertake the dissolution work: Realisation A/c Dr. To Partner’s Capital A/c
