READ THE FOLLOWING INFORMATION AND ANSWER THE FOLLOWING QUESTION.
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
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%.
What is the sale value of land and building?
Answer & explanation
Correct answer: option 2
The correct answer is option 2- ₹9,00,000.
Land and building = 8,00,000
Profit = 12.5%
Profit amount = 8,00,000 x 12.5/100
= 1,00,000
Sale value = 8,00,000 + 1,00,000
= 9,00,000