Realization Account Transactions

This assignment focuses on the process of winding up a partnership business by illustrating the recording of various transactions in a realization account. It includes entries for transferring assets, liabilities, expenses, and ultimately distributing the remaining profit to partners. The provided examples showcase journal entries and culminate in a calculation of the final bank balance.

Running head: ACCOUNTS
Accounts
Name of the Student:
Name of the University:
Authors Note:

1ACCOUNTS
Table of Contents
Answer to Question 15: Partnership HJK........................................................................................2
Answer to Question 19 Primary Production Joe Lambi..................................................................3
Answer to Question 11: Chapter 7 Primary Producer.....................................................................5
Answer to Question 15 Rob and Roy..............................................................................................6
Answer to Question 9: Partnership Marry and Elle.........................................................................6
Answer to Self-Test exercise 4 ratio................................................................................................7
Answer to Question 15: ratio Chiara Industries..............................................................................8
Answer to Question 7: Ratio Lens Industries..................................................................................8
Answer to Question 13 Bill and Coo...............................................................................................9
Answer to Partnership Q 19 K and L.............................................................................................10
Answer to Question 17 Chapter 6: Leilani Social Club................................................................10
Answer to Question 11: Chapter 6 Sydney Sports Club................................................................12
Answer to Question 25: Chapter 7 Wood Agricultural Company.................................................13
Answer to Question 13: Partnership O and P................................................................................13
Answer to Question 13 Song, Sung and Blue................................................................................16
Answer to Question 3: Partnership Abel, babel and Capel...........................................................18
Answer to Question 7: Partnership P and Q..................................................................................19
Bibliography..................................................................................................................................21

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Answer to Question 15: Partnership HJK
Realization Account
Particulars Amount Particulars Amount
Inventory $18,000.00 Allowance for doubtful debt $500.00
Accounts Receivable $4,000.00 Accounts Payable $3,000.00
Freehold $100,000.00 Mortgage $35,000.00
Plant Machinery $14,000.00
Goodwill $10,000.00 Bank $100,300.00
Partners’ Capital( H: Inventory taken) $6,000.00
Bank $4,800.00 Partners’ Capital (loss) $6,000.00
Total $150,800.00 Total $150,800.00
Bank Account
Particulars Amount Particulars Amount
Opening Balance $1,500.00 Realization
Realization Creditors $2,800.00
Freehold $83,000.00 Expenses $2,000.00
Plant and machinery $13,900.00
Accounts Receivable $3,400.00 Partners’ Capital
H $37,000.00
J $40,000.00
K $20,000.00
Total $101,800.00 Total $101,800.00

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H $37,000.00
J $40,000.00
K $20,000.00
$0.00
Total $101,800.00 Total $101,800.00
Partners capital Account (current)
Particulars H J K Particulars H J
Answer to Question 19 Primary Production Joe Lambi
Joe Lambi
Sheep working Account
Particulars Debit Credit Balance
Number Amount Number Amount Number
Opening Stock 01/07/2018 20000 $120,000.00 20000
Purchase 10000 $122,500.00 30000
Natural Incresae 25000 $150,000.00 55000
Sales- Sheep 26000 $390,000.00 29000
Ration General 200 $1,200.00 28800
Dead and Missing 150 28650
Weighted Average cost
Number Amount
20000 $120,000.00
10000 $122,500.00

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25000 $150,000.00
55000 392500
Cost $7.14
Journal Entry
Particulars Debit Credit
Ration $1,800.00
Sheep Working $1,200.00
Wool Working $600.00
(Being 300 sheep’s killed for ration recorded)
Profit or loss Account $1,800.00
Ration $1,800.00
(Being ration expenses transferred to PL)
Wool Working $600.00
(Being 300 sheeps killed for ration recorded)
Profit or loss Account $1,800.00
Ration $1,800.00
(Being ration expenses transferred to PL)

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Answer to Question 11: Chapter 7 Primary Producer
A
Statement showing cost per head for Inventory Valuation
Particulars Number Amount
Opening Balance 3000 $ 18,000.00
Purchase 4500 $ 38,250.00
Natural Increase 3000 $ 12,000.00
Total 10500 $68,250.00
Average Cost per head $ 6.50
B
Purchase 4500 $ 38,250.00
Natural Increase 3000 $ 12,000.00
Total 10500 $68,250.00
Average Cost per head $ 6.50
B Sheep working Account
Particulars Debit Credit Balan
Number Amount Number Amount Number
C
Journal Entry
Particulars Debit Credit
Ration $325.00
Sheep Working $325.00

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(Being 50 sheep’s killed for ration recorded)
Profit or loss Account $325.00
Ration $325.00
(Being ration expenses transferred to PL)
Answer to Question 15 Rob and Roy
In the Books of Rob and Roy
Journal Entry
Particulars Debit Credit
Business Purchase $50,000.00
Liquidator of Joan $50,000.00
(Being Due entry for business Purchase)
Inventory $36,000.00
Plant $8,000.00
Accounts Receivable $4,000.00
Goodwill $2,000.00
Business Purchase $50,000.00
(Being assets taken over recorded)
Liquidator of Joan $50,000.00
Cash $50,000.00
(Being payment due have been amde0
Answer to Question 9: Partnership Marry and Elle
Journal Entry
Particulars Debit Credit
Land and Building $36,000.00
Revaluation $36,000.00
(Being land and building revalued)
Accumulated Depreciation - Plant $5,000.00
Revaluation $5,000.00
(Being depreciation reduced)

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Revaluation $5,000.00
Accounts Receivable $5,000.00
(Being Accounts receivable reduced)
Revaluation $36,000.00
Mary Capital $24,000.00
Elle Capital $12,000.00
(Being profit on revaluation transferred)
Bank $26,000.00
Tom Capital $26,000.00
(Being Tom bought cash as capital)
Answer to Self-Test exercise 4 ratio
Calculation of Inventory turnover ratio
Particulars Amount
COGS (A) $1,100,000.00
Opening Inventory $100,000.00
Closing Inventory $120,000.00
Average Inventory (B) $110,000.00
Inventory Turnover ratio (A/B) 10.00
Calculation of Accounts receivable Collection period
Particulars Amount
Credit Sales (A) $3,650,000.00
Average Debtors (B) $ 450,000.00
Debtor Turnover ratio (A/B) 8.11
Average Collection Period (days) 45

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Answer to Question 15: ratio Chiara Industries
Statement Showing calculation of ratio
Particulars Formula Amount
A) Current Assets $400,000.00
Current Liabilities $200,000.00
Current Ratio
(Current Assets/ Current
Liability) 2
B) Liquid Assets $250,000.00
Current Liabilities $150,000.00
Liquid Ratio
((Current Assets-
Inventory)/( Current Liability-
BO)) 1.67
C) COGS (A) $480,000.00
Opening Inventory $170,000.00
Closing Inventory $150,000.00
Average Inventory (B) $160,000.00
Inventory Turnover Ratio (COGS/Average Inventory Ratio) 3.00
D) Credit Sales $875,000.00
Average Receivable $260,000.00
Debtor Turnover ratio (Credit Sales/Average Debtors) 3.37
Average Collection Period (days) (365/Average collection period) 108
Answer to Question 7: Ratio Lens Industries
Statement Showing calculation of ratio
Particulars Formula Amount
A) Gross Profit $800,000.00
Net Sales $1,750,000.00
Gross Profit Ratio (GP/Sales) 46%
B) Net Profit $300,000.00

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Net Sales $1,750,000.00
Net Profit Ratio (NP/Sales) 17%
C) Current Assets $750,000.00
Current Liabilities $450,000.00
Current Ratio
(Current Assets/ Current
Liability) 2
D) Liquid Assets $450,000.00
Current Liabilities $425,000.00
Liquid Ratio
((Current Assets- Inventory)/
(Current Liability-BO)) 1.06
Answer to Question 13 Bill and Coo
In the books of Bill and Coo
Journal Entry
Particulars Debit Credit
Cash at Bank $11,000.00
Inventory $20,000.00
Office Equipment $5,000.00
Provision for Accumulated depreciation $1,000.00
Accounts Payable $15,000.00
Bill Capital $20,000.00
(Being Assets and Liabilities and taken over)
Cash at Bank $1,000.00
Accounts Receivable $17,000.00
Plant and machinery $17,000.00
Goodwill $5,000.00
Provision for Accumulated depreciation $5,000.00
Accounts Payable $10,000.00
Coo Capital $25,000.00
(Being Assets and Liabilities and taken over)

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Answer to Partnership Q 19 K and L
In the Books of K and L
Journal Entry
Particulars Debit Credit
Bank $9,000.00
Inventory $10,000.00
Accounts Payable $4,000.00
Loan $6,000.00
K Capital $9,000.00
(Being Assets and Liability taken over)
Inventory $14,000.00
Premises $36,000.00
van $10,000.00
L Capital $60,000.00
(Being assets and Liabilities taken over)
Bank $11,000.00
K Capital $11,000.00
(Being additional Cash bought in for maintaining ratio 2:1)
Answer to Question 17 Chapter 6: Leilani Social Club
a)
Members Subscription Account
Particulars Amount Particulars Amount
Balance b/d (arrear subscription) $280.00
Balance b/d (received in
advance in previous year) $440.00
Income and Expenditure
Account(b/f)
$30,040.0
0 Cash (subscription received)
$30,000.0
0
Balance c/d (received in advance) $360.00
Balance c/d (arrear
subscription) $240.00
Total
$30,680.0
0 Total
$30,680.0
0

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b)
Receipt and Payment Account
Receipt Amount Payment Amount
Balance b/d (cash at bank) $19,000.00 Barman wages $1,200.00
Subscription received $30,000.00 Bar purchase $5,000.00
Bar Sales $7,800.00 Furniture Purchased $1,400.00
Donation $160.00 Club managers Salary $12,000.00
Insurance $3,200.00
Maintenance of club facilities $1,800.00
Printing and Stationery $450.00
Rent paid $960.00
Sundry Expenses $400.00
Wages $3,400.00
Balance c/d $27,150.00
Total $56,960.00 Total $56,960.00
c)
Bar Trading Statement
Particulars Amount
Bar Sales $7,800.00
Less:
Barman Wages $1,200.00
Bar purchase $5,000.00
Net Profit $1,600.00
d)

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Income and Expenditure Account
Expenditure Amount Income Amount
Club managers Salary $12,000.00 Members Subscription $30,040.00
Depreciation $400.00 Income from bar trading $1,600.00
Insurance $3,200.00 Donation received $160.00
Maintenance of club facilities $1,800.00
Printing and Stationery $450.00
Rent $860.00
Sundry Expenses $400.00
Wages $3,440.00
Net Profit $9,250.00
Total $31,800.00 Total $31,800.00
Answer to Question 11: Chapter 6 Sydney Sports Club
Sydney Sporting Club
Receipt and payment Account
Receipt Amount Payment Amount
Balance b/d $6,600.00 Cleaning $200.00
Donation received $250.00 Equipment Purchase $3,000.00
Interest on Investment $390.00 Improvement to Clubhouse $2,975.00
Magazine Advertising Revenue $3,400.00 Investment in Bonds $4,000.00
Members Subscription $8,040.00 Printing Stationery $1,175.00
Refreshment sales $4,700.00 Refreshment Purchase $1,600.00
Balance c/d $10,430.00
Total $23,380.00 Total $23,380.00
Answer to Question 25: Chapter 7 Wood Agricultural Company
Maize Crop Growing Account
Particulars Debit Credit Balance (Dr)

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Seed stock $1,500.00 $1,500.00
Cost Incurred $30,900.00 $32,400.00
Caring cost $23,900.00 $56,300.00
Maize Crop Working Account $56,300.00 $0.00
Maize Crop Working Account
Particulars Debit Credit Balance (Cr)
Sales $83,450.00 $83,450.00
Closing Inventory $2,400.00 $85,850.00
Growing Maize Crop $56,300.00 $29,550.00
Profit and Loss $29,550.00 $0.00
Answer to Question 13: Partnership O and P
a)
In the books of Miles Enterprise
Journal Entry
Particulars Debit Credit
Partners Salary $80,000.00
Current- O $40,000.00
Current- P $40,000.00
(Being Salary paid to partners)
Current - O $2,400.00
Current- P $1,600.00
Interest on Drawing $4,000.00
(Being interest charged on drawing)
Current Account- P $3,000.00
Interest on Advance $3,000.00
(Being interest on advance charged)
Interest on Loan $6,000.00
Current Account -O $6,000.00
(Being interest on loan credited)
Interest on Fixed Capital $18,000.00
Current Account- O $12,000.00

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Current Account- P $6,000.00
(Being interest on Fixed Capital credited)
Profit and Loss Appropriation Account $104,000.00
Partners Salary $80,000.00
Interest on Loan $6,000.00
Interest on Fixed Capital $18,000.00
(Being transferred to PL Appro.)
Interest on Drawing $4,000.00
Interest on Advance $3,000.00
Profit and Loss Appropriation Account $7,000.00
(Being transferred to PL Appro)
Profit or Loss Account $255,000.00
Profit and Loss Appropriation Account $255,000.00
(Being Profit Transferred)
Profit and Loss Appropriation Account $158,000.00
Current Account- O $118,500.00
Current Account-P $39,500.00
(Being profit transferred to partners current Account)
b)
Profit or loss Appropriation Account
Particulars Amount Particulars Amount
Partners Salary $80,000.00 Net Profit b/d $255,000.00
Interest on Loan $6,000.00 Interest on Drawing $4,000.00
Interest on Fixed Capital $18,000.00 Interest on Advance $3,000.00
Partners’ Capital $158,000.00
Total $262,000.00 Total $262,000.00
c)

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Partners Current Account
Particulars O P Particulars O P
Drawings $6,000.00
$40,000.0
0 Balance b/d
$115,000
.00
$50,000.
00
Interest on
Drawing $2,400.00 $1,600.00 Partners Salary
$40,000.
00
$40,000.
00
Interest on
Advance $3,000.00 Interest on Loan
$6,000.0
0
Interest on Fixed Capital
$12,000.
00
$6,000.0
0
Balance c/d
$283,100.
00
$90,900.0
0
Profit and Loss
Appropriation Account
$118,500
.00
$39,500.
00
Total
$291,500.
00
$135,500.
00 Total
$291,500
.00
$135,500
.00
d)
Extract Trial Balance
Particulars Debit Credit
Advance to P $100,000.00
Loan from O $200,000.00
Capital- O $400,000.00
Capital-P $200,000.00
Current- O $283,100.00
Current- P $90,900.00
Drawings -O $60,000.00
Drawings -P $40,000.00
Answer to Question 13 Song, Sung and Blue
a)
Profit or loss Appropriation Account

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Particulars Amount Particulars Amount
Partners Salary Net Profit b/d $67,100.00
Song $15,000.00
Sung $17,500.00 Interest on Drawings
Blue $20,000.00 Song $2,000.00
Sung $1,500.00
Interest on Fixed capital Blue $800.00
Song $3,000.00
Sung $2,500.00
Blue $2,000.00
Partners’ Capital Account
Song $3,800.00
Sung $3,800.00
Blue $3,800.00
Total $71,400.00 Total $71,400.00
b)
Partners Capital Account
Song $3,800.00
Sung $3,800.00
Blue $3,800.00
Total $71,400.00 Total $71,400.00
C)
Balance Sheet
Amount Amount
Assets
Bank $54,600.00
Accounts Receivable $84,000.00

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Less:
Allowance for doubtful debt $1,130.00
$82,870.00
Inventory $80,000.00
Fixture and Fittings $14,400.00
Less:
Accumulated Depreciation $1,440.00
$12,960.00
Motor Vehicle $74,000.00
Less:
Accumulated Depreciation $37,000.00
$37,000.00
Total Assets $267,430.00
Accounts payable $69,330.00
Capital Account
Song $70,000.00
Sung $60,000.00
Blue $50,000.00
$180,000.00
Current Account
Song $3,800.00
Sung $5,300.00
Blue $9,000.00
$18,100.00
Total Liabilities $267,430.00
Answer to Question 3: Partnership Abel, babel and Capel
JOURNAL ENTRIES
PARICULARS DEBIT CREDIT
Profit and Loss Appropriation Account
$40,000.0
0
Abel Capital Account
$16,000.0
0
Babel Capital Account $16,000.0

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0
Capel Capital Account $8,000.00
(Being profit transferred to partners’ capital)
Capel Capital Account
$12,000.0
0
Capel Current Account
$12,000.0
0
(Being Capel's current account balance transferred to capital
account)
Salary Account $4,000.00
Capel Capital Account $4,000.00
(Being one month salary was due so paid)
Revaluation Account
$15,000.0
0
Abel Capital Account $6,000.00
Babel Capital Account $6,000.00
Capel Capital Account $3,000.00
(Being net increase in assets revaluation)
Answer to Question 7: Partnership P and Q
In the books of P and Q
Journal Entry
Particulars Debit Credit
Realization Account $17,500.00
Other Assets $17,500.00
(Being transfer of assets to Realization Account)
Accounts Payable $10,000.00
Realization Account $10,000.00

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(Being transfer of Liabilities to Realization Account)
Bank Account $25,000.00
Realization Account $25,000.00
(Being sale of other assets realized)
Realization Account $9,000.00
Bank Account $9,000.00
(Being Account payable settled)
Realization Expense Account $500.00
Bank Account $500.00
(Being realization expenses paid)
Realization Account $8,000.00
P's Capital Account $4,000.00
Q's Capital Account $4,000.00
(Being realization profit transferred to partner capital)
P's Capital Account $10,000.00
Q's Capital Account $8,000.00
Bank Account $18,000.00
(Being partners paid)
Calculation of bank Balance
Particulars Amount
Balance $2,500.00
Assets realized $25,000.00
Accounts payable -$9,000.00
Expenses realization -$500.00
Bank balance available $18,000.00

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Bibliography
Henderson, S., Peirson, G., Herbohn, K. and Howieson, B., 2015. Issues in financial accounting.
Pearson Higher Education AU.
Weil, R.L., Schipper, K. and Francis, J., 2013. Financial accounting: an introduction to
concepts, methods and uses. Cengage Learning.