Partnership

Dissolution

Medium

common

At the time of dissolution of a partnership firm goodwill does not appears in the balance sheet but a partner took over it at Rs. 60,000 for cash, how this transaction will be recorded in firm's books.

Date	Particulars	Dr. ₹	Cr. ₹
	Realisation A/c Dr.	60,000
	To Cash A/c		60,000

Date	Particulars	Dr. ₹	Cr. ₹
	Cash A/c Dr.	60,000
	To Realisation A/c		60,000

Date	Particulars	Dr. ₹	Cr. ₹
	Partner's Capital A/c Dr.	60,000
	To Realisation A/c		60,000

Will not be recorded anywhere.

✅ Correct Option: 2

Unrecorded goodwill still has realisable value, so the gain must be routed through Realisation A/c. Here the partner pays cash for it, so cash actually flows into the firm.

Entry: Cash A/c Dr. 60,000, To Realisation A/c 60,000.

Had he taken it over without paying, his Capital A/c would have been debited instead.

Note: The phrase "took over it for cash" can read either as a takeover or a cash purchase. We have followed the explicit mention of cash and credited Realisation through Cash.

2024

Determine the amount of Profit and Loss Account.

2026: 6 June Shift 1

Arrange the following in the correct sequence for the purpose of preparing Realisation account.

(A) Settlement of Unrecorded Assets and Liabilities

(B) Transfer of Assets and Liabilities to Realisation A/c

(D) Sale of Assets and Payment of Liabilities

Choose the correct answer from the options given below:

2025: 27 May Shift 2

Which Journal Entry will be recorded for realization of unrecorded asset at the time of dissolution of a Partnership Firm.

2025: 22 May Shift 2

According to Section ………. of the partnership Act 1932, the dissolution of partnership between all the partners of a firm is called the dissolution of the firm.

2025: 16 May Shift 1

While settlement of Accounts, what should be the order of application of assets of Firm

(A) In paying the debts of the firm to the third parties

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

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

Choose the correct answer from the options given below:

2025: 31 May Shift 1

Unrecorded liabilities when paid are shown in:

At the time of dissolution of a partnership firm goodwill does not appears in the balance sheet but a partner took over it at Rs. 60,000 for cash, how this transaction will be recorded in firm's books.

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