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CUET Accountancy 2025 PYQs30 May Shift 1. Free, no login required.

Partnership

past year questions, CUET Accountancy 2025 30 May Shift 1

Dissolution

past year questions, Partnership, CUET Accountancy 2025 30 May Shift 1

Medium

common

When a firm is dissolved, the Balance of Investment Account and Balance of Investment Fluctuation Fund Account, shown by Firm's Balance Sheet are transferred into _________and into _________respectively:-

Solution

✅ Correct Option: 1

When a firm is dissolved, all assets and liabilities are transferred to the Realisation Account to determine profit or loss on realization.

Investment Account represents an asset of the firm. All assets (except cash and bank) are transferred to the Debit side of Realisation Account because assets carry debit balances.

Investment Fluctuation Fund Account is a reserve created to cover any decline in the value of investments. It carries a credit balance. During dissolution, this fund is transferred to the Credit side of Realisation Account to offset the book value of investments and determine the actual profit or loss on their realization.

The journal entries would be:

For transferring Investment:

ParticularsDebitCredit
Realisation A/c Dr.✓
To Investment A/c✓

For transferring Investment Fluctuation Fund:

ParticularsDebitCredit
Investment Fluctuation Fund A/c Dr.✓
To Realisation A/c✓

The Investment Fluctuation Fund is transferred to the credit side of Realisation Account to reduce the book value of investments, which helps in correctly calculating the gain or loss when investments are actually sold during dissolution.

Correct Option: 1 - Debit Side of Realisation Account (Investment), Credit side of Realisation Account (Investment Fluctuation Fund)

Related questions:

2025: 15 May Shift 1

Match List-I with List-II

List-IList-II
(A) Payment of loans due to partners(I) Realisation A/c Dr To Bank A/c
(B) For settlement of partners' accounts, in case their capital account shows a debit balance(II) Bank A/c Dr. A/c To loan to partners
(C) For settlement of loan by a firm to a partner(III) Bank A/c Dr. To Partner's Capital A/c
(D) For settlement of any unrecorded liability(IV) Partner's Loan A/c Dr. To Bank A/c

Choose the correct answer from the options given below:

2025: 26 May Shift 2

Realisation account doesn't show-

2026: 13 May Shift 1

At the time of Dissolution of a Partnership Firm, the assets of the firm, including any sum contributed by the partners to make up deficiencies of capital, shall be applied among the partners in the following manner and order:

(A) The residue, if any, shall be divided among the partners in their profit sharing ratio.

(B) In paying each partner proportionately what is due to him/her from the firm for advances as distinguished from capital (i.e. partner' loan);

(C) In paying the debts of the firm to the third parties;

(D) In paying to each partner proportionately what is due to him on account of capital; and

Choose the correct answer from the options given below:

2025: 31 May Shift 1

Unrecorded liabilities when paid are shown in:

2026: 29 May Shift 2

Varun (partner) had given a loan to firm of Rs. 5,00,000. On dissolution, he accepted furniture of Rs. 4,50,000 against the loan. The balance Rs. 50,000 will be:

2026: 6 June Shift 1

In case of dissolution of firm, if a partner agrees to take over the debtors of Rs. 80,000 at 10% discount, the entry for the same shall be:

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