If total assets are ₹2,00,000; total liabilities are ₹40,000; amount realised on sale of assets is ₹1,75,000 and realisation expenses are ₹3,000, the profit or loss on realisation will be :
Answer & explanation
Correct answer: option 3
The correct answer is option 3- Loss ₹28,000.
Realisation A/c
| Particulars | Amount (₹) | Particulars | Amount (₹) |
| To Assets (Transfer of assets) |
2,00,000 | By Liabilities (Transfer of liabilities) |
40,000 |
| To Bank A/c (Liabilities paid) |
40,000 | By Bank A/c (Realisation of Assets) |
1,75,000 |
| To Bank A/c (Expenses) | 3,000 | By Partner's capital A/c (Loss) | 28,000 |
| 2,43,000 | 2,43,000 |
NOTE- if nothing is mentioned about the payment of liability then it is assumed that they are fully paid.