o20 To Z's Capital Alc 4,800 By Z's Capital Alc 8.100 76.900 76.900 *X and Z bring these amounts to make good their share of the loss on realisation. In actual practice they will not be bringing any cash; only a notional entry will be made. Capital Accounts x x Y Z 7 To Sundry Trade By Balance bid 29,200 10.800 10,000 Creditors- 1,600 1.600 800 omission To Balance cld 27.600 9.200 9.200 29,200 10,800 10.000 29.200 10.800 10.000 To Advance 4.000 By Balance bild 27.600 9.200 9.200 To Realisation Alc 9,600 9,600 4,800 By Mrs. X's Loan 10.000 loss To Y's Capital AC 3,300 1,100 By Cash (Realisation 9,600 4.800 loss) By X's Capital Alc 3.300 To Cash 34,300 8,100 By Z's Capital Alc 1.100 47,200 13,600 14,000 47,200 13,600 14,000 Note. Y's deficiency comes to 3 4.400 (difference in the two sides of his Capital Account); this has been debited to X and Z in the ratio of 27,600: 9.200 ie., capital standing up just before dissolution but after correction of error committed while drawing up the accounts for 2012 Illustration 5 'Thin', 'Short' and 'Fat' were in partnership sharing profits and losses in the ratio of 2:21. On 30th September, 2012 their Balance Sheet was as follows: Liabilities Assets Capital Accounts Premises 50,000 Thin 80,000 Fixtures 1,25,000 Short 50,000 Plant 32,500 Fat 20,000 1.50,000 Stock 43,200 Current Accounts: Debtors 54.780 Thin 29.700 Short 11,300 Fat (Dr.) (14.500) 26.500 Sundry Creditors 84.650 Bank Overdraft 44,330 3.05.480 3.05.480 'Thin' decides to retire on 30th September, 2012 and as 'Fat appears to be short of private assets. Short' decides that he does not wish to take over Thin's share of partnership, so all three partners decide to dissolve the partnership with effect from 30th September, 2012 then transpires that "Fat' has no private assets whatsoever. The premises are sold for 760,000 and the plant for 1.07,500. The fixtures realize 20,000 and the stock is acquired by another firm at book value less 5% Debtors realise 45,900. Realisation expenses amount to 4,500. The bank overdraft is discharged and the creditors are also paid in full. You are required to write up the following ledger accounts in the partnership books following the rules in Garner vs. Murray (0) Realisation Account: (1) Partners' Current Accounts: (ii) Partners' Capital Accounts showing the closing of the firm's books