Practicing Success
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 ADDITIONAL INFORMATION-
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Pass the journal entry for the investments takeover. |
X's capital A/c Dr. ₹1,90,000 X's capital A/c Dr. ₹1,90,000 Realisation A/c Dr. ₹1,90,000 Investments A/c Dr. ₹1,90,000 |
X's capital A/c Dr. ₹1,90,000 |
The correct answer is option 1- Investments is transferred to realisation account at the value of ₹2,00,000. After this it is takeover by X. So, journal entry will be- It means X's capital is reduced by this amount as he took over the investments of this amount. |