What Journal entries would be passed for discharge of following unrecorded liabilities on the
Channel: Doubtnut
Date: 2020-03-29

What Journal entries would be passed for discharge of following unrecorded liabilities on the dissolution of a firm of partners A and B . (a) There was a contingent liability in respect of bills discounted but not matured of ? 18,500 . An acceptor of one bill of ? 2, 500 became insolvent and fifty paise in a rupee was recovered . The liability of the firm on account of this bill discounted and dishonoured has not so far been recorded . (b) There was a contingent liabillity in respect of a claim for damages for ? 75,000 , such liability was settled for ? 50 , 000 and paid by the partner A . (c) Firm will have to pay ? 10 , 000 as compensation to an injured employee , which was a contingent liability not accepted by the firm . (d) ? 5,000 for damages claimed by a customer has been disputed by the firm . It was settled at 70% by a compromise between the customer and the firm .