Question : Realization expenses of Rs. 5,000 were to be borne by Pavit, a partner. However, it was paid by Hitesh, another partner. It was to be recorded in the books. The entry will be
Option 1: Debited realisation account Rs 5,000, credited Pavit's capital account Rs 5,000
Option 2: Debited realisation account Rs 5,000, credited Bank account Rs 5,000
Option 3: Debited realisation account Rs 5,000 and credited Hitesh's capital account Rs 5,000
Option 4: Debited Pavit's capital account and credited Hitesh's capital account Rs 5,000
Correct Answer: Debited Pavit's capital account and credited Hitesh's capital account Rs 5,000
Solution : Answer = Debited Pavit's capital account and credited Hitesh's capital account Rs 5000
When Realisation Expenses were Bear by Partner and were Paid by another Partner. then the Entry will Be. Bearing Partner's Capital A/C Dr. To Bearing Partner's Capital AlC. Hence, the correct option is 4.
Question : Realization expenses were to be borne by A for which he is to get a credit of Rs. 10,000. Actual realization expenses paid out of the firm Bank Account amounted to Rs. 12,000. Choose the correct Journal entry for the treatment of realization expenses.
Option 1: Realization account debit Rs 12,000 and credited Bank account Rs 12,000
Option 2: Debited realization account and credited partners capital account with Rs 12,000
Option 3: Debited A's capital account Rs 12,000 and credited bank account Rs 12,000
Option 4: None of these
Question : Mohan and Kanwar are partners in a firm. Their firm was dissolved on 1.1.2013. Mohan was assigned the work of dissolution. For this work Mohan was to be paid Rs.500. Mohan paid dissolution expenses of Rs.400 from his own pocket. Choose the correct Journal entry
Option 1: Debited realization account by Rs 400 and credited bank account Rs 400
Option 2: Debited realization account by Rs 900 and credited mohan's capital account Rs 900
Option 3: Debited realization account Rs 500 credited Moahn's capital acccout Rs 400 and bank account Rs 100
Option 4: None of the above
Question : Q, a partner, was appointed to look after the process of dissolution for which he was allowed a remuneration of Rs. 18,000. Q agreed to take over stock worth Rs. 18,000 as his remuneration. The stock had already been transferred to the Realisation Account. The entry will be
Option 1: Debited realization account Rs 18,000 and credited Q's capital account Rs 18,000
Option 2: Debited realization account Rs 18,000 and credited bank account Rs 18,000
Option 3: No entry required
Option 4: Debited bank account Rs 18,000 and credited partner's capital account Rs 18,000
Question : Vijay, a partner, paid realization expenses of Rs. 10,000 and these were to be borne by him. Vijay's capital account will be
Option 1: Debited by Rs 10,000
Option 2: Credited by Rs 10,000
Option 3: Debited by Rs 1000
Option 4: None of the above.
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