RO 6. Mr. Khalid and Mr. Amjad are partners in a firm. They share profits and the losses in the ratio of 4:1. They decide to dissolve the firm on 31st/3/2008, and on this date the balance sheet is as follows: Balance Sheet Equity & Liabilities RO Assets Capital Accounts: Trade mark 6,000 Mr. Khalid's Capital A/C 80,000 Machine 60,000 Mr. Amjad's Capital A/C 30,000 Furniture 2,000 Bank loan 7,500 Stock 30,000 Creditors for goods 40,000 Debtors Less: Provision for Bills payable 2,500 Bad Debts 45,000 - 2,000 43,000 Cash in hand 14,000 Profit & loss A/C 5,000 Total 160,000 Total 160,000 The realization shows the following results: Debtors were realized at book value less 10% Goodwill was sold for RO 5,000. Trade mark was realized for RO 4,000. Machinery and stock were taken over by K respectively for RO 72,000 and RO 18,000 An unrecorded asset estimated at RO 3,000 was sold for 1,000. A creditor for goods was settled at discount of RO 400. The expenses on realization were RO 2,000