Instruction: Complete ALL questions from this section. Question 1 Mary, Jane and Susan are in partnership sharing profits and losses in the ratio 2:2:1 respectively. The following was their balance sheet as at 31 December 2018: Cost Depreciation. NBV Non-Current Assets $ $ $ Premises 42,000 32,000 10,000 Motor Vehicles 14,000 10,000 4,000 Furniture and Fittings 6,000 2,000 4,000 62,000 44,000 18,000

Current Assets Inventory 24,000 Trade Receivables 6,800 30,800 48,800

Capital and Liabilities Capitals: Mary 7,000 Jane 7,000 Susan 4,000 18,000

Current A/cs

Mary 6,800 Jane 5,000 Susan 3,400 15,200

33,200

Loan from Toby 6,000

Current Liabilities: Trade Payables 7,800 Bank overdraft 1,800 9,600 48,800

On 31 December 2018 the partners decide to terminate the business. The following took place: i. Mary took over one of the motor vehicles for $5,000 ii. Stock was taken over by Susan for $12,000 iii. Premises, inventory, the remaining motor vehicles, furniture and fittings were sold for $9000, $12000, $1000 and $1000 respectively iv. Receivables realised $6,450 and Payables were paid in full v. Dissolution Expenses amounted to $100 vi. Susan was declared insolvent and was unable to repay the amount owed to the partnership. The partnership was terminated on December 31, 2018

A. You are required to prepare the following accounts to record the termination of the partnership:

i. Realisation Account (7.5 marks)