Alpha and Beta, in partnership, and sharing profits in the ratio 3:2 respectively, drafted their Statement of financial position as set out on the left, and decided to dissolve their partnership. The dissolution progressed as follows:

(i) Alpha took over a vehicle which was acquired for £54,000 and had been depreciated by this date to £30,000; while Beta took over the investments at an agreed value of £54,000.

(ii) Inventory realised £218,000 and receivables were collected subject to 20% write-off.

(iii) Trade payables were settled receiving a discount of 10%.

(iv) Non-current assets realised £450,000.

(v) Expenses of dissolution amounted to £11,000. 

Required:

Record these transactions showing the closure of the partnership books.

Transcribed Image Text:

Statement of financial position as at 31 December 2012 Non-current assets at cost Accumulated depreciation Investments Inventory Receivables Cash and bank balance £'000 890 (240) 650 45 328 180 36 1,239