Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Dissolution of Partnership Firm

Question:

On dissolution of a firm, a partner's capital account has a credit balance of ₹12,000. His share of profit in realisation account is ₹10,000. He has paid firm's realisation expenses of ₹3,000. He will finally get a payment of:

Options:

₹22000

₹25000

₹19000

₹15000

Correct Answer:

₹25000

Explanation:

The correct answer is option 2- ₹25000.

When realisation expenses are paid by a partner on behalf of the firm:
Realisation A/c Dr.
    To Partner’s Capital A/c
So realisation expenses are refunded to the partner.

Thus, amount due to partner will be = Credit balance + profit on realisation + Realisation expenses
                                                    = 12,000+10,000+3,000
                                                    = 25,000