Match List-I Dissolution transactions with List-II Journal Entries
List-I
A. For sale of assets
B. Transfer of assets to realisation account
C. Creditors took machinery for full settlement of his claims
D. Dissolution expenses paid
List-II
I. No Journal Entry
II. Bank A/c Dr. To Realisation A/c
III. Realisation A/c Dr. To Assets A/c
IV. Realisation A/c Dr. To Bank A/c
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 3
Correct answer: Option (3) → A - II, B - III, C - I, D - IV
Concept: On dissolution, assets and liabilities are closed through the Realisation Account; an asset taken over by a creditor in full settlement needs no journal entry – per Dissolution of Partnership Firm.
A. Sale of assets → Bank A/c Dr. To Realisation A/c (II).
B. Transfer of assets to realisation → Realisation A/c Dr. To Assets A/c (III).
C. Creditor takes machinery in full settlement → No Journal Entry (I), as the asset and the liability leave together.
D. Dissolution expenses paid → Realisation A/c Dr. To Bank A/c (IV).
Hence A-II, B-III, C-I, D-IV.