Question 1 (50 marks) Chan. Lau and Wong, who share profits and losses in the ra
ID: 2511269 • Letter: Q
Question
Question 1 (50 marks) Chan. Lau and Wong, who share profits and losses in the ratio of 3:4:5, decided to terminate their partnership as at 31 March 2017. Any deficiency in capital after realization will be shared by other partners according to the profit or loss sharing ratio Their statement of financial position on that date was as follows Non-current assets Machine Building Motor vehicle 900,000 400,000 300,000 1,600,000 Current assets Accounts receivable Cash at bank 530,000 460,000 990,000 Less: Current liabilities Accounts payable (493.000) 497,000 2,097,000Explanation / Answer
a) Partners Realisation Account as on 31st March,2017
Date
Particulars
Amount
Date
Particulars
Amount
To Machine
900,000
By Bank
To Building
400,000
Machine
450,000
To Motor Vehicle
300,000
Building
300,000
To Accounts Receivable
530,000
Motorvehicle
200,000
To Dissolution Expense
10,000
Accounts receivable
350,000
To bank
By Accounts payable
493,000
Accounts payable
460,000
By Partner's Capital
807000
Chan
201,750
Lau
269,000
Wong
336,250
2,600,000
2,600,000
b) Partners Bank Account as on 31st March,2017
Date
Particulars
Amount
Date
Particulars
Amount
To balance b/d
460,000
By Accounts payable
460,000
To Machine
450,000
By Dissolution Expense
10,000
To Building
300,000
By Partner's Capital
To Motor Vehicle
200,000
1290000
To Accounts Receivable
350,000
Chan
322,500
Lau
430,000
Wong
537,500
1,760,000
1,760,000
c) Partners Capital Account as on 31st March,2017
Particulars
Chun
Lau
Wong
Particulars
Chun
Lau
Wong
To Realisation
201,750
269,000
336,250
By balance b/d
990,000
210,000
897,000
To Bank
322,500
430,000
537,500
Profit & Loss
465,750
23,250
Profit & Loss
489,000
990,000
699,000
897,000
990,000
699,000
897,000
a) Partners Realisation Account as on 31st March,2017
Date
Particulars
Amount
Date
Particulars
Amount
To Machine
900,000
By Bank
To Building
400,000
Machine
450,000
To Motor Vehicle
300,000
Building
300,000
To Accounts Receivable
530,000
Motorvehicle
200,000
To Dissolution Expense
10,000
Accounts receivable
350,000
To bank
By Accounts payable
493,000
Accounts payable
460,000
By Partner's Capital
807000
Chan
201,750
Lau
269,000
Wong
336,250
2,600,000
2,600,000
b) Partners Bank Account as on 31st March,2017
Date
Particulars
Amount
Date
Particulars
Amount
To balance b/d
460,000
By Accounts payable
460,000
To Machine
450,000
By Dissolution Expense
10,000
To Building
300,000
By Partner's Capital
To Motor Vehicle
200,000
1290000
To Accounts Receivable
350,000
Chan
322,500
Lau
430,000
Wong
537,500
1,760,000
1,760,000
c) Partners Capital Account as on 31st March,2017
Particulars
Chun
Lau
Wong
Particulars
Chun
Lau
Wong
To Realisation
201,750
269,000
336,250
By balance b/d
990,000
210,000
897,000
To Bank
322,500
430,000
537,500
Profit & Loss
465,750
23,250
Profit & Loss
489,000
990,000
699,000
897,000
990,000
699,000
897,000
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