Q 28 Abha and Bimal are partners in a firm sharing profits and losses in the ratio of - Accountancy - Reconstitution- Admission of a Partner

Question

Q 28 Abha and Bimal are partners in a firm sharing profits and
losses in the ratio of 3 : 2 On 31st
March, 2015 they admitted Chintu into partnership for 1/5th share
in the profits Of the firm
On that date their Balance Sheet stood as under:

Liabilities
Amount
Assets
Amount

Abha Capital A/c:
120000
Plant and Machinery
130000

Bimal Capital A/c:
100000
Furniture
25000

General Reserve
20000
Investment
100000

Sundry Creditors
100000
Sundry Debtors
50000

Bank
35000

340000

Chintu was admitted on the following terms:
(i) He will bring 80,000 as capital and 30,000 for his share of
goodwill premium
(ii) Partners will share future profits in the ratio of 5 : 3 :
2
(iii) Profit on revaluation of assets and reassessment of
liabilities was 7,000
(iv) After making adjustments, the Capital Accounts of the partners
will be in proportion
to Chintu's capital Balance to be paid off or brought in by the old
partners by cheque
as the case may be

Prepare the Capital Accounts of the partners and Bank Account

Neha Arora · Accepted Answer

Dear Student,

Partners’ Capital Accounts

Dr

Cr

Particulars
Abha
Bimal
Chintu

Bank A/c

5,800

Balance b/d
1,20,000
1,00,000

Balance c/d
2,00,000
1,20,000
80,000
Bank A/c

80,000

Premium for Goodwill A/c
15,000
15,000

General Reserve
12,000
8,000

Revaluation A/c
4,200
2,800

Bank A/c
48,800

2,00,000
1,25,800
80,000

Bank
Account

Dr

Cr

Particulars
Amount
Rs
Particulars
Amount
Rs

Balance b/d
35,000
B’s Capital A/c
5,800

Chintu’s Capital
A/c
80,000
Balance c/d
1,88,000

Premium for Goodwill A/c
30,000

A’s Capital A/c
48,800

1,93,800

Working Notes:

Calculation of Sacrificing Ratio
Abha's sacrifice=35-510=110Bimal's sacrifice=25-310=110Sacrificing Rtaio=1:1

Calculation of New Capitals of the Partners
Total Capital of thw Firm=80,000×102=4,00,0004,00,000 in 5:3:2Abha's New Capital=4,00,000×510=2,00,000Bimal's New Capital=4,00,000×310=1,20,000Chintu's New Capital=4,00,000×210=80,000

Adjustment of Capitals

Abha's New Capital (2,00,000) > Abha's Existing Capital
(1,51,200) - Abha will bring in 48,800
Bimal's New Capital (1,20,000) < Bimal's Existing Capital
(1,25,800) - Bimal will withdraw 5,800

Liabilities	Amount	Assets	Amount
Abha Capital A/c:	120000	Plant and Machinery	130000
Bimal Capital A/c:	100000	Furniture	25000
General Reserve	20000	Investment	100000
Sundry Creditors	100000	Sundry Debtors	50000
		Bank	35000
	340000		340000

Partners’ Capital Accounts
Dr.				Cr.
Particulars	Abha	Bimal	Chintu	Particulars	Abha	Bimal	Chintu
Bank A/c		5,800		Balance b/d	1,20,000	1,00,000
Balance c/d	2,00,000	1,20,000	80,000	Bank A/c			80,000
				Premium for Goodwill A/c	15,000	15,000
				General Reserve	12,000	8,000
				Revaluation A/c	4,200	2,800
				Bank A/c	48,800
	2,00,000	1,25,800	80,000		2,00,000	1,25,800	80,000

Bank Account
Dr.				Cr.
Particulars	Amount Rs	Particulars	Amount Rs
Balance b/d	35,000	B’s Capital A/c	5,800
Chintu’s Capital A/c	80,000	Balance c/d	1,88,000
Premium for Goodwill A/c	30,000
A’s Capital A/c	48,800
	1,93,800		1,93,800