Section$-$D

Answer two of the following. Each question carries $15$ marks.

$40.M,N$ and $O$ were sharing profits and losses in the ratio $3$:$2$:$1.$ Their Balance Sheet as on ${30}^{th}$ June, $2014$ was as follows on which date they decided to dissolve the firm.

$\backslash$table$[[$Liabilities$,$Rs$,$Assets,Rs$],[$Capitals: $M,30,000,$Cash in hand,$3,800],[O,22,000,$Cash at bank,$10,000],[$Depreciation reserve,$2,000,$Sundry debtors,$22,000],[$Provision for bad debts,$1,000,$Stock,$19,000],[$Werkmen$\text{'}$s acci. Comp. fund,$2,000,$Fixed assets,$34,000],[$Benk loan secured by stock,$10,000,$N$\text{'}$s Capital,$3,000],[$Employees provided fund,$4,000,,],[$Sundry creditors,$20,800,,],[,91,800,,],[,,,]]$

M was engaged to realise the assets and settle the liabilities for which he would get $5\%$ of the amount realized from fixed assets as remuneration. But he had to bear all expenses on dissolution. Sundry debtors realized Rs $19,000$ and fixed assets realized Rs $40,000.$ Sundry creditors agreed to accept the stock of the firm in full settlement of their claims.

During the course of dissolution, it was found that a bill of Rs $12,000$ discounted by the firm had been dishonoured and a net liability on it had to be paid Rs $4\mathrm{.}000.$

An amount of Rs $800$ had to be paid for accident compensation. The actual realization expenses amounted to Rs $1,200.$

The firm had a pending case against a supplier of inferior goods for a compensation of Rs $8,000.$ On settlement the court awarded an amount of Rs $3000$ and is received. Prepare ledger accounts on dissolution of the firm.