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Ace, Lina and Fila have been in partnership for several years, sharing profits and losses in the ratio 3:1:1. They decide to dissolve their partnership.
Ace, Lina and Fila have been in partnership for several years, sharing profits and losses in the ratio 3:1:1. They decide to dissolve their partnership. Their last balance sheet which was prepared on 31 December 2022 is as follows: Statement of Financial Position Ace, Lina and Fila as at 31 December 2022 The non-current assets realised $75,000. The expenses of dissolution were \$250 and discounts totaling \$200 were received from creditors. REQUIRED: (a) Explain the THREE (3) steps involved in partnership dissolution. (6 marks) (b) Describe the following: (i) Realisation Account; (7 marks) (ii) Capital Account; and (6 marks) (iii) Cash Account. (6 marks)
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