The Hobbit

Explain what happened to the village near the mountain

In chapter 11 of the hobbit

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They persist through the area called the "Desolation of Smaug" and see the remains of a town called "Dale." The town is burnt and in smoky ruins. Balin remembers the stories of this forefathers' narrow escape from the dragon's destruction and this only re-kindles the dwarves desire to reclaim their stolen jewels and wealth.