Dissolution T, U and V were partners in a firm sharing profits and losses in the ratio of 2:1:2. Their firm was incurring huge losses thus it had to be closed. After transferring assets (other than cash in hand and bank) and third party liabilities to realization account the following transactions took place:
- T took away 50% of the stock at book value less 10% for ₹90,000, and the remaining stock was sold for ₹40,000.
- Creditors of ₹78,000 took over machinery of ₹80,000 in full settlement of their claim.
- ₹5,000 debtors previously written off were recovered.
- Mrs. V’s loan of ₹72,000 was paid by the firm.
- Loss on dissolution was ₹80,000.
Pass necessary journal entries for the above transactions in the books of T, U and V