Double Entry Book Keeping Ts Grewal (2017) Solutions for Class 12 Commerce Accountancy Chapter 4 Retirement And Death Of A Partner are provided here with simple step-by-step explanations. These solutions for Retirement And Death Of A Partner are extremely popular among class 12 Commerce students for Accountancy Retirement And Death Of A Partner Solutions come handy for quickly completing your homework and preparing for exams. All questions and answers from the Double Entry Book Keeping Ts Grewal (2017) Book of class 12 Commerce Accountancy Chapter 4 are provided here for you for free. You will also love the ad-free experience on Meritnation’s Double Entry Book Keeping Ts Grewal (2017) Solutions. All Double Entry Book Keeping Ts Grewal (2017) Solutions for class 12 Commerce Accountancy are prepared by experts and are 100% accurate.

Page No 4.110:

Answer:

a) X : Y : Z = 12  : 310 : 15 = 5 : 3 : 2 (old ratio)Calculation of New Ratio1) If X retires, then Y and Z will share profits in the ratio of 3 : 2   2)If Y retires, then X and Z will share profits in the ratio of 5 : 23) If Z retires, then X and Y will share profits in the ratio of 5 : 3

b) X : Y : Z = 25  : 25 : 15 = 2 : 2 : 1 (old ratio)Calculation of New Ratio1) If X Retires, then Y and Z will share profits in the ratio of 2 : 1  2) If Y Retires, then X and Z will share profits in the ratio of 2 : 13) If Z Retires, then X and Y will share profits in the ratio of 1 : 1

Note: Since no information about new ratio is given, it is assumed that partner’s will gain in their old ratio.

Page No 4.110:

Answer:

Old Ratio (Ram, Mohan and Sohan) = or 3 : 5 : 7

Sohan’s Profit Share =

Ram and Mohan decided to take his share in the ratio of 3 : 2

New Profit Share = Old Profit Share  +  Share taken from Sohan

∴ New Profit Ratio (Ram and Mohan) = 36 : 39 or 12 : 13

Page No 4.110:

Answer:

Old Ratio: B : C = 4 : 4 : 2 or 410 : 410 :210 Calculation of New RatioB's share taken by C = 410A's New share = 410C's New share = 210 + 410 = 610 New Ratio = 410 : 610 or 2 : 3

Page No 4.110:

Answer:

Old Ratio (Kangli, Mangli and Sanvali) = 4 : 3 : 2

New Ratio (Mangli and Sanvali) = 5 : 3

Gaining RatioNew Ratio − Old Ratio

∴Gaining Ratio = 21 : 11

Page No 4.110:

Answer:

: B : C = 12 : 13 : 16 = 3  : 2 : 1  (Old Ratio): C = 3 : 2 (New Ratio)Calculation of Gaining Ratio Gaining Ratio = New Ratio - Old RatioA = 35 - 36 =  18 - 1530330C = 25 - 16 =  12 - 530730Gaining Ratio = 3 : 7

Page No 4.110:

Answer:

: Y : Z = 49 : 13 : 29 = 4 : 3 : 2 (Old ratio)X acquired 49th share of Z and Y acquired 59th [1 - 49] share of ZX's Gain = 29 × 49 = 881Y's Gain = 29 × 59 = 1081Gaining Ratio of X:Y = 8 : 10 = 4  : 5 Calculation of New Profit Sharing RatioX's New Share = 49 + 881 = 36 + 881 = 4481Y's New Share = 39 + 1081 = 27 + 1081 = 3781New Ratio = 44  : 37 

Page No 4.110:

Answer:

A:B:C : D = 4 : 3 : 2 : 1 (Old ratio)D acquired 13rd share of A and C acquired 23rd [1 - 13] share of AC's Gain = 410 × 23 = 830D's Gain = 410 × 13 = 430Gaining Ratio of C : D = 8  : 4 = 2  : 1 Calculation of New Profit Sharing RatioB's New share = 310 or 930C's New share = 210 + 830 = 6 + 830 = 1430D's New share = 110 + 430 = 3 + 430 = 730New Ratio = 9  : 14 : 7 

Page No 4.110:

Answer:

: B : C = 2 : 2 : 1 (Old Ratio): B = 2 : 2 (New Ratio)Calculation of Gaining Ratio = New Ratio - Old RatioA's Gain = 24 - 25 =  10 - 820220B's Gain = 24 - 25 =  10 - 820220 A : B = 1 : 1



Page No 4.111:

Answer:

: B : C  = 49 : 13 : 29 = 4 : 3 : 2 (Old ratio)B surrenders 19th share in favour of A and 29th share in favour of CGaining Ratio of A: C = 1 : 2  Calculation of New Profit Sharing RatioA's New share = 49 + 19  = 59C's New share = 29 + 29  = 49New Ratio  = 5  : 4 

Page No 4.111:

Answer:

Calculation of Gaining and New ratio:A:B:C:D=3:3:2:1(Old ratio)A's share=39D's Gain=39×23=627C's Gain=39×13=327Gaining Ratio of C:D=1:2 B's New Share=39×33=927C's New Share=29+327=927D's New Share=19+627=927B:C:D=1:1:1

Page No 4.111:

Answer:

Journal

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

Naresh’s Capital A/c

Dr.

 

15,000

 

Yogesh’s Capital A/c

Dr.

 

15,000

 

To Mukesh’s Capital A/c

 

 

30,000

(Adjustment Mukesh’s share of goodwill made)

 

 

 

 

 

 

 

Working Notes:

WN 1 Calculation of Gaining Ratio

Old Ratio = 2 : 2 : 1 : 1

Mukesh retires from the firm.

New Ratio = 1 : 1 : 1

Gaining RatioNew Ratio − Old Ratio

∴Gaining Ratio (Naresh and Yogesh) = 1 : 1

WN 2 Adjustment of Goodwill

Goodwill of the firm = Rs 90,000

Mukesh’s share of goodwill

This share of goodwill is to be debited to remaining Partners’ Capital Accounts in their gaining ratio (i.e. 1 : 1).

Page No 4.111:

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
  X’s Capital A/c Dr.   9,600  
  Y’s Capital A/c Dr.   7,200  
  Z’s Capital A/c Dr.   4,800  
 
To Goodwill A/c
      21,600
  (Goodwill appearing in the books was written–off)      
           
  X’s Capital A/c Dr.   3,900  
  Z’s Capital A/c     3,300  
 
To Y’s Capital A/c
      7,200
  (Goodwill adjusted through Partners’ Capital Accounts)      
         

Working Notes:

WN 1: Calculation of Gaining Ratio

: Y : Z = 4  : 3 : 2 (Old Ratio): Z = 5 : 3 (New Ratio)Gaining Ratio = New Ratio - Old RatioX's Gain = 58 - 49 =  45 - 32721372Z's Gain = 38 - 29 =  27 - 16721172 Gaining Ratio = 13 : 11

WN 2: Calculation of Goodwill
Total amount of Goodwill = 7,200 × 93 = Rs 21,600

Page No 4.111:

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit Amount (Rs)
  Y’s Capital A/c Dr.   15,000  
 
To Z’s Capital A/c
      7,500
 
To X’s Capital A/c
      7,500
  (Goodwill adjusted through Partners’ Capital Accounts)        
         

Working Notes: Calculation of Gaining Ratio

Old Ratio = 3 : 2 : 1 New Ratio = 1 : 2Gaining Ratio = New Ratio - Old RatioX = 13 - 36  = 2 - 36 = -16 (Sacrifice)Y= 23 - 26 = 4 - 26 = 26 (Gain)X will get  = 45,000 × 16 = Rs 7,500Y will give = 45,000 × 26 = Rs 15,000Z will get  = 45,000 × 16 = Rs 7,500

Page No 4.111:

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

 

 

 

 

 

 

Profit & Loss Appropriation A/c

Dr.

 

64,000

 

 

       To X’s Capital A/c

 

 

 

46,000

 

       To Z’s Capital A/c

 

 

 

18,000

 

(Profit Shared among new partners)

 

 

 

 

 

 

 

 

 

 

 

X’s Capital A/c

Dr.

 

70,000

 

 

Z’s Capital A/c

Dr.

 

50,000

 

 

     To Y’s Capital A/c

 

 

 

1,20,000

 

(Goodwill adjusted through capital)

 

 

 

 

 

 

 

 

 

Working Notes:

Calculation of Gaining and New ratio:Old ratio of X, Y & Z=4:3:1Gaining ratio of X & Z=7:5Y's share=38X's Gain=38×712=2196Z's Gain=38×512=1596X's New Share=48+2196=6996Z's New Share=18+1596=2796X:Z=69:27or23:9.

Page No 4.111:

Answer:

Journal
Date Particulars L.F. Debit Amount (Rs) Credit Amount (Rs)
  X’s Capital A/c Dr.   5,000  
  Y’s Capital A/c     25,000  
 
To Z’s Capital A/c
      30,000
  (Goodwill adjusted through Partners’ Capital Accounts)      
         

Working Notes: Calculation of Gaining Ratio

Old Ratio = 1 : 2 : 3New Ratio = 1 : 3Gaining Ratio = New Ratio - Old RatioX = 14 - 16  = 3 - 212 = 112 Y= 34 - 26 = 9 - 412 = 512 : Y = 1 : 5Z's share of Goodwill = Rs 30,000 (3,00,000 - 2,70,000)

Page No 4.111:

Answer:

Revaluation Account

Dr.

 

Cr.

Particulars

Amount

Rs

Particulars

Amount

Rs

Plant and Machinery (40,000 × 10%)

4,000

Building (1,00,000 × 20%)

20,000

Provision for Doubtful Debts

1,000

Stock of Finished Goods

5,000

Stock of Raw Materials

2,000

Computer

2,000

Workmen’s Compensation Claim

5,000

 

 

Profit transferred to:

 

 

 

  A’s Capital A/c

6,000

 

 

 

B’s Capital A/c

6,000

 

 

 

C’s Capital A/c

3,000

15,000

 

 

 

27,000

 

27,000

 

 

 

 

 

Journal

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

Building A/c     

Dr.

 

20,000

 

Stock of Finished Good A/c

Dr.

 

5,000

 

Computer A/c

Dr.

 

2,000

 

To Revaluation A/c

 

 

27,000

(Increase in value Assets transferred to Revaluation Account)

 

 

 

 

 

 

 

Revaluation A/c

Dr.

 

12,000

 

To Plant and Machinery A/c

 

 

4,000

To Provision for Doubtful Debts A/c

 

 

1,000

To Stock of Raw Material A/c

 

 

2,000

To Workmen’s Compensation Claim A/c

 

 

5,000

( Decrease in value of Assets and increase in Liabilities transferred to Revaluation Account)

 

 

 

 

 

 

 

Revaluation A/c

Dr.

 

15,000

 

To A’s Capital A/c

 

 

6,000

To B’s Capital A/c

 

 

6,000

To C’s Capital A/c

 

 

3,000

(Revalution Profit transferred to Partners’ Capital accounts)

 

 

 

 

 

 

 



Page No 4.112:

Answer:

Revaluation Account
Particulars Amount (Rs) Particulars Amount (Rs)
Plant & Machinery A/c 3,500 Stock A/c 5,000
Motor Van A/c 1,200 Building A/c 4,500
Outstanding bill for Repairs 2,500 Prepaid fire insurance 2,500
Provision for Doubtful Debts A/c 1,950    
Profit transferred to:      
A’s Capital A/c
1,425      
B’s Capital A/c
950      
C’s Capital A/c
475 2,850    
       
  9,500   9,500
       
 
B’s Capital Account
Particulars Amount (Rs)   Amount (Rs)
B’s Loan A/c (Balancing figure) 40,950 Balance b/d 30,000
    General Reserve A/c 4,000
    A’s Capital A/c 4,500
    C’s Capital A/c 1,500
    Revaluation A/c 950
  40,950   40,950
       

Working Notes: Calculation of B’s Share of Goodwill

B’s Share of Goodwill = 18,000 × 13 = Rs 6,000Gaining Ratio (A : C) = 3 : 1 A will compensate = 6,000 × 34 = Rs 4,500C will compensate = 6,000 × 14 = Rs 1,500

Page No 4.112:

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

X’s Capital A/c

Dr

 

3,000

 

 

Z’s Capital A/c

Dr.

 

7,000

 

 

     To Y’s Capital A/c

 

 

 

10,000

 

(Revaluation adjusted through capital)

 

 

 

 

 

 

 

 

 

 

Working Notes:

WN1: Calculation of Gaining Ratio

X:Y:Z=3 :2:1(Old ratio)X:Z=3:2(New ratio)X's Gain=3536=330Z's Gain=2516=730X:Z=3:7
 

WN2: Adjustment for Y's share

Y's Share in Revaluation= 30,000×26=Rs 10,000 It should be debited to X's Capital A/c and Z's Capital A/c in the ratio of 3:7

WN 3: Adjustment for Revaluation of Assets & Liabilities
 

Particulars

Amount

Rs

Land and Building

50,000

Trade Creditors

5,000

Less:  

Plant and Machinery

10,000

Outstanding Expenses

15,000

Profit

30,000

 

Page No 4.112:

Answer:

Journal
Date Particulars L.F. Debit Amount (Rs) Credit Amount (Rs)
  General Reserve A/c Dr.   60,000  
 
To X’s Capital A/c
      30,000
 
To Y’s Capital A/c
      20,000
 
To Z’s Capital A/c
      10,000
  (General reserve distributed among the partners in old ratio)      
           
  X’s Capital A/c Dr.   15,000  
  Y’s Capital A/c Dr.   10,000  
  Z’s Capital A/c Dr.   5,000  
 
To Profit & Loss A/c
      30,000
  (Debit balance of Profit & Loss distributed among the partners in old ratio)      
           
  Workmen Compensation Reserve A/c Dr.   24,000  
 
To X’s Capital A/c
      12,000
 
To Y’s Capital A/c
      8,000
 
To Z’s Capital A/c
      4,000
  (Workmen compensation reserve distributed among the partners in old ratio)      
         

Note: Employees provident fund is a statutory liability of the firm, thus, it will not be distributed among the partners.

Page No 4.112:

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

P’s Capital A/c

Dr

 

3,000

 

 

R’s Capital A/c

Dr.

 

7,000

 

 

     To Q’s Capital A/c

 

 

 

10,000

 

(Reserves adjusted through capital)

 

 

 

 

 

 

 

 

 

 

Working Notes:

WN1: Calculation of Gaining Ratio

P:Q:R=3 :2:1(Old ratio)P:R=3:2 (New ratio)P's Gain=3536=330R's Gain=2516=730P:R=3:7

WN2: Calculation of Amount to be Adjusted 

Amount to be adjusted = General Reserve + Contingency Reserve + P&LAdvertisement Suspense                                    = 30,000+5,000+15,00020,000 = Rs 30,000Q's share = 30,000×26=Rs 10,000Rs 10,000 to be charged from P&R in the ratio of 3:7

 



Page No 4.113:

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

X’s Capital A/c

Dr

 

20,000

 

 

Z’s Capital A/c

Dr.

 

10,000

 

 

     To Y’s Capital A/c

 

 

 

30,000

 

(Reserves adjusted through capital)

 

 

 

 

 

 

 

 

 

 

Working Notes:

WN1: Calculation of Gaining Ratio

X:Y:Z=1:1:1(Old ratio)X:Z=5:4(New ratio)X's Gain=5913=29Z's Gain=4913=19X:Z=2:1

WN 2: Amount to be adjusted

Particulars

(Rs)

General Reserve

50,000

+ Contingency Reserve

5,000

+ Profit and Loss Account

30,000

+ Investment Fluctuation Reserve

5,000

+ Workmen Compensation Reserve

10,000

-Advertisement Suspense

10,000

Total

90,000

 

 


Y's share = 90,000×13=Rs 30,000 to be charged from X and Z in the ratio of 2:1

Page No 4.113:

Answer:

Revaluation Account
Particulars Amount (Rs) Particulars Amount (Rs)
Plant & Machinery A/c 2,000 Stock A/c 6,000
Furniture A/c 1,000 Building A/c 6,000
Provision for Doubtful Debts A/c 500    
Profit transferred to:      
X’s Capital A/c
3,400      
Y’s Capital A/c
3,400      
Z’s Capital A/c
1,700 8,500    
       
  12,000   12,000
       
 
Partners’ Capital Accounts
Dr.   Cr.
Particulars X Y Z Particulars X Y Z
Y’s Capital A/c 5,333   2,667 Balance b/d 40,000 40,000 30,000
Y’s Loan A/c   57,400   X’s Capital A/c   5,333  
Balance c/d 44,067   32,033 Z’s Capital A/c   2,667  
        Reserve A/c 6,000 6,000 3,000
        Revaluation A/c 3,400 3,400 1,700
  49,400 57,400 34,700   49,400 57,400 34,700
               
 
Balance Sheet
as on March 31, 2017
Liabilities Amount
(Rs)
Assets Amount (Rs)
Capital A/cs:   Cash 3,000
X
44,067   Sundry Debtors 20,000  
Z
32,033 76,100
Less: Provision for Doubtful Debts
1,500 18,500
Creditors 25,000 Furniture 10,000  
Bills Payable 12,000
Less: Depreciation
1,000 9,000
Y’s Loan 57,400 Plant & Machinery 40,000  
   
Less: Depreciation
2,000 38,000
    Stock 30,000  
   
Add: Appreciation
6,000 36,000
    Land & Building 60,000  
   
Add: Appreciation
6,000 66,000
  1,70,500   1,70,500
       

Working Notes: Calculation of Y’s Share of Goodwill

Y’s Share of Goodwill = 20,000 × 25 = Rs 8,000Gaining Ratio (X : Z) = 2 : 1 X will compensate = 8,000 × 23 = Rs 5,333Z will compensate = 8,000 × 13 = Rs 2,667

Page No 4.113:

Answer:

Journal

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

Revaluation A/c

Dr.

 

400

 

To Provision for Doubtful Debts A/c

 

 

400

(Provision for Doubtful Debts created)

 

 

 

 

 

 

 

Building A/c

Dr.

 

7,000

 

To Revaluation A/c

 

 

7,000

(Increase in value of Building transferred to Revaluation Account)

 

 

 

 

 

 

 

Revaluation A/c

Dr.

 

6,600

 

To A’s Capital A/c

 

 

3,300

To B’s Capital A/c

 

 

2,200

To C’s Capital A/c

 

 

1,100

(Revaluation profit distributed among partners in their old ratio)

 

 

 

 

 

 

 

A’s Capital A/c

Dr.

 

2,250

 

C’s Capital A/c

Dr.

 

750

 

To B’s Capital A/c

 

 

3000

(Share of B’s goodwill adjusted in gaining ratio of A and C)

 

 

 

 

 

 

 

B’s Capital A/c

Dr.

 

15,200

 

To B’s Loan A/c

 

 

10,200

To Cash A/c

 

 

5,000

(Rs 5,000 paid to B and balance transferred to his Loan Account)

 

 

 

 

Balance Sheet

as on March 31, 2017 (after B’s Retirement)

Liabilities

Amount

Rs

Assets

Amount

Rs

Sundry Creators

13,590

Cash (5,900 – 5,000)

900

 

 

Debtors

8,000

 

B’s Loan A/c

10,200

Less: Provision for Doubtful Debts

 

400

 

7,600

Capital A/cs:

 

Stock

11,690

A

16,050

 

 

 

C

10,350

26,400

Building (23,000 + 7,000)

30,000

 

50,190

 

50,190

 

 

 

 


Working Notes:

WN 1 Adjustment of Goodwill

Old Ratio (A, B and C) = 3 : 2 : 1

B retires from the firm.

∴ Gaining Ratio = 3 : 1

Goodwill of the firm = Rs 9,000

B’s Share of Goodwill =

This share of goodwill is to be distributed between A and C in their gaining ratio (i.e. 3 : 1).



WN 2

Revaluation Account

Dr.

 

Cr.

Particulars

Amount

Rs

Particulars

Amount

Rs

Provision for Doubtful Debts (8,000 × 5%)

400

Building

7,000

Profit transferred to:

 

 

 

A’s Capital A/c

3,300

 

 

 

B’s Capital A/c

2,200

 

 

 

C’s Capital A/c

1,100

6,600

 

 

 

7,000

 

7,000

 

 

 

 


WN 3 

Partners’ Capital Accounts

Dr.

 

Cr.

Particulars

A

B

C

Particulars

A

B

C

B’s Capital A/c  (Goodwill)

2,250

 

750

Balance b/d

15,000

10,000

10,000

Cash

 

5,000

 

Revaluation A/c (Profit)

3,300

2,200

1,100

B’s Loan A/c

 

10,200

 

A’s Capital A/c (Goodwill)

 

2,250

 

Balance c/d

16,050

 

10,350

B’s Capital A/c (Goodwill)

 

750

 

 

18,300

15,200

11,100

 

18,300

15,200

11,100

 

 

 

 

 

 

 

 



Page No 4.114:

Answer:

Journal
Date Particulars L.F. Debit
Amount
(Rs)
Credit
Amount
(Rs)
1. Revaluation A/c Dr.   1,17,000  
 
To Debtors A/c
        17,000
 
To Furniture A/c
      40,000
 
To Land & Building A/c
      60,000
  (Transferred  decrease in the value of assets)        
           
2. Stock  A/c Dr.   19,000  
  Plant & Machinery A/c     33,000  
 
To Revaluation A/c
        52,000
  (Transferred  increase in the value of assets)        
           
3. Ram’s Capital A/c Dr.   32,500  
  Shyam’s Capital A/c Dr.   19,500  
  Mohan’s Capital A/c Dr.   13,000  
 
To Revaluation A/c
        65,000
  (Transferred loss on revaluation)        
           
4. General Reserve A/c Dr.   1,00,000  
  Workmen Compensation Reserve A/c Dr.   67,500  
 
To Ram’s Capital A/c
      83,750
 
To Shyam’s Capital A/c
      50,520
 
To Mohan’s Capital A/c
      33,500
  (Reserve distributed)        
           
5. Ram’s Capital A/c Dr.   9,000  
  Shyam’s Capital A/c     9,000  
 
To Mohan’s Capital A/c
      18,000
  (Goodwill adjusted through capital)        
           
6. Mohan’s Capital A/c Dr.   1,65,000  
 
To Bank A/c
      1,65,000
  (Cash paid to Mohan)        
           
7. Bank A/c Dr.   1,65,000  
 
To Ram’s Capital A/c
      99,000
 
To Shyam’s Capital A/c
      66,000
  (Cash brought in by Ram and Shyam)        
           
8. Mohan’s Capital A/c Dr.   73,500  
 
To Mohan’s Loan A/c
      73,500
  (Balance of capital transferred to loan account)        
         
 
Revaluation Account
Particulars Amount (Rs) Particulars Amount (Rs)
Debtors A/c 17,000 Stock A/c 19,000
Furniture A/c 40,000 Plant & Machinery A/c 33,000
Land and Building A/c 60,000 Loss transferred to:  
   
Ram’s Capital A/c
32,500  
   
Shyam’s Capital A/c
19,500  
   
Mohan’s Capital A/c
13,000 65,000
  1,17,000   1,17,000
       
 
Partners’ Capital Accounts
Dr.   Cr.
Particulars Ram Shyam Mohan Particulars Ram Shyam Mohan
Revaluation A/c 32,500 19,500 13,000 Balance b/d 4,00,000 6,00,000 2,00,000
Mohan’s Capital A/c 9,000 9,000   General Reserve A/c 50,000 30,000 20,000
Bank A/c     1,65,000 Workmen Compensation Reserve A/c 33,750 20,250 13,500
Mohan’s Loan A/c     73,500 Ram’s Capital A/c     9,000
Balance c/d 5,41,250 6,87,750   Shyam’s Capital A/c     9,000
        Bank A/c 99,000 66,000  
  5,82,750 1,16,250 2,51,500   5,82,750 1,16,250 2,51,500
               
 
Balance Sheet
as on March 31, 2017
Liabilities Amount (Rs) Assets Amount (Rs)
Capital A/cs:   Cash 55,000
Ram
5,41,250   Debtors 3,40,000  
Shyam
6,87,750 12,29,000
Less:  Debtors written-off
17,000 3,23,000
Creditors 1,98,000 Furniture 1,42,500
Bills Payable 92,500 Plant & Machinery 2,35,300
Mohan’s Loan 73,500 Stock 2,00,000
    Land & Building 2,00,000
    Bank 1,61,500
    Computer 1,32,000
    Investments 1,43,700
  15,93,000   15,93,000
       

Working Notes: Calculation of Gaining Ratio

Ram : Shyam : Mohan = 5  : 3 : 2 (Old Ratio)Ram : Shyam= 3 : 2 (Old Ratio)Ram's Gain = 35 - 510 =  6 - 510110Shyam's Gain = 25 - 310 =  4 - 310110 R : S = 1 : 1Mohan’s Share in Goodwill = 90,000 × 210 = Rs 18,000

Page No 4.114:

Answer:

Revaluation Account
Particulars Amount (Rs) Particulars Amount (Rs)
Plant A/c 15,000 Freehold Property A/c 10,000
Stock A/c 5,500 Loss transferred to:  
Provision for Doubtful Debts A/c 1,500
A’s Capital A/c
4,800  
   
B’s Capital A/c
4,800  
   
C’s Capital A/c
2,400 12,000
  22,000   22,000
       
 
Partners’ Capital Accounts
Dr.   Cr.
Particulars A B C Particulars A B C
Revaluation A/c 4,800 4,800 2,400 Balance b/d 1,25,750 1,00,000 85,000
A’s Capital A/c 30,000 B’s Capital A/c 30,000 15,000
C’s Capital A/c   15,000 Bank A/c 2,24,300
Bank A/c 1,50,950 97,600        
Balance c/d 2,74,500        
               
  1,55,750 3,24,300 1,00,000   1,55,750 3,24,300 1,00,000
               
 
Bank Account
Particulars Amount (Rs)   Amount (Rs)
Balance b/d 24,250 A’s Capital A/c 1,50,950
B’s Capital A/c
(Balancing Figure)
2,24,300 C’s Capital A/c 97,600
  2,48,550   2,48,550
       
 
Balance Sheet
as at….
Liabilities Amount
(Rs)
Assets Amount (Rs)
B’s Capital A/c: 2,74,500 Freehold Property 90,000  
Trade Creditors 70,000
Add: Appreciation
10,000 1,00,000
    Plant 1,50,000  
   
Less: Depreciation
15,000 1,35,000
    Debtors 62,500  
   
Less: Provision for Doubtful Debts
2,500 60,000
    Stock 55,000  
   
Less: Depreciation
5,500 49,500
         
  3,44,500   3,44,500
       



Page No 4.115:

Answer:

M’s Capital Account
Particulars Amount
(Rs)
  Amount
(Rs)
Drawings A/c 30,000 Balance b/d 1,12,500
Interest on Drawings A/c 3,000 Interest on Capital A/c 750
M’s Loan A/c
(Balancing Figure)
1,50,000 Salary A/c 2,250
    Profit & Loss A/c 37,500
    Goodwill A/c 30,000
  1,83,000   1,83,000
       
 
M’s Loan Account
Dr. Cr.
Date Particulars Amount
(Rs)
Date Particulars Amount (Rs)
2015     2015    
March 31 Balance c/d 1,50,000 March 31 M’s Capital A/c 1,50,000
    1,50,000     1,50,000
2016     2015    
March 31 Bank A/c (75,000 + 15,000) 90,000 April 01 M’s Capital A/c 1,50,000
March 31 Balance c/d 75,000 2016    
      March 31 Interest A/c @ 10% 15,000
    1,65,000     1,65,000
2017     2016    
March 31 Bank A/c (75,000 + 7,500) 82,500 April 01 Balance b/d 75,000
      2017    
      March 31 Interest A/c @ 10% 7,500
    82,500     82,500
           

Page No 4.115:

Answer:

P’s Capital Account
Particulars Amount (Rs)   Amount (Rs)
P’s Loan A/c 46,700 Balance b/d 45,000
    P’s Current A/c 1,700
  46,700   46,700
       
 
P’s Current Account
Particulars Amount (Rs)   Amount (Rs)
Balance b/d 2,300 Goodwill 12,000 × 26 4,000
P’s Capital A/c 1,700    
  4,000   4,000
       
 
P’s Loan Account
Dr. Cr.
Date Particulars Amount (Rs) Date Particulars Amount (Rs)
2010     2010    
Dec. 31 Bank A/c 10,000 Dec. 31 P’s Capital A/c 46,700
  Balance c/d 36,700      
    46,700     46,700
2011     2011    
Dec. 31 Bank A/c 10,000 Jan. 01 Balance b/d 36,700
  Balance c/d 28,902 Dec. 31 Interest A/c 2,202
    39,902     38,902
2012     2012    
Dec. 31 Bank A/c 10,000 Jan. 01 Balance b/d 28,902
  Balance c/d 20,636 Dec. 31 Interest A/c 1,734
    30,636     30,636
2013     2013    
Dec. 31 Bank A/c 10,000 Jan. 01 Balance b/d 20,636
  Balance c/d 11,874 Dec. 31 Interest A/c 1,238
    21,874     21,874
2014     2014    
Dec. 31 Bank A/c 10,000 Jan. 01 Balance b/d 11,874
  Balance c/d 2,586 Dec. 31 Interest A/c 712
    12,586     12,586
2015     2015    
Dec. 31 Bank A/c 2,741 Jan. 01 Balance b/d 2,586
      Dec. 31 Interest A/c 155
    2,741     2,741
           

Page No 4.115:

Answer:

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

2016

 

 

 

 

 

April 01

X’s Capital A/c

Dr.

 

4,000

 

 

Y’s Capital A/c

Dr.

 

6,000

 

 

Z’s Capital A/c

Dr.

 

2,000

 

 

   To Goodwill A/c

 

 

 

12,000

 

(Existing goodwill written-off)

 

 

 

 

 

 

 

 

 

 

 

X’s Capital A/c

Dr.

 

49,600

 

 

  To Y’s Capital A/c

 

 

 

18,600

 

  To Z’s Capital A/c

 

 

 

31,000

 

(Goodwill adjusted by debiting gaining partner and crediting sacrificing partner)

 

 

 

 

 

 

 

 

 

 

Land and Building A/c

Dr.

 

20,000

 

 

Sundry Creditors A/c

Dr.

 

30,000

 

 

  To Revaluation A/c

 

 

 

50,000

 

(Increase in value of land & building and decrease in value of creditors recorded in Revaluation Account)

 

 

 

 

 

 

 

 

 

 

 

Revaluation A/c

Dr.

 

43,000

 

 

  To Stock A/c

 

 

 

38,000

 

  To Provision for Doubtful Debts A/c

 

 

 

5,000

 

(Decrease in value of stock and increase in provision for doubtful debts, recorded in revaluation)

 

 

 

 

 

 

 

 

 

 

 

Prepaid Insurance A/c

Dr.

 

5,000

 

 

  To Revaluation A/c

 

 

 

5,000

 

(Amount paid for insurance carried forward as unexpired insurance)

 

 

 

 

 

 

 

 

 

 

 

Revaluation A/c

Dr.

 

12,000

 

 

   To X’s Capital A/c

 

 

 

4,000

 

   To Y’s Capital A/c

 

 

 

6,000

 

   To Z’s Capital A/c

 

 

 

2,000

 

(Profit on revaluation transferred to Partners’ Capital Accounts in old profit sharing ratio of 2 : 3 : 1)

 

 

 

 

 

 

 

 

 

 

 

Workmen Compensation Reserve A/c

Dr.

 

20,000

 

 

   To Workmen Compensation Claim A/c

 

 

 

8,000

 

   To X’s Capital A/c

 

 

 

4,000

 

   To Y’s Capital A/c

 

 

 

6,000

 

   To Z’s Capital A/c

 

 

 

2,000

 

(Excess balance of WCR transferred to partners’ capital account)

 

 

 

 

 

 

 

 

 

 

 

Investments Fluctuation Reserve A/c

Dr.

 

10,000

 

 

   To Investments A/c

 

 

 

4,000

 

   To X’s Capital A/c

 

 

 

2,000

 

   To Y’s Capital A/c

 

 

 

3,000

 

   To Z’s Capital A/c

 

 

 

1,000

 

(Decrease in market value of investments settled through IFF and excess balance is transferred to partners’ capital accounts)

 

 

 

 

 

 

 

 

 

 

 

X’s Capital A/c

Dr.

 

4,000

 

 

Y’s Capital A/c

Dr.

 

6,000

 

 

Z’s Capital A/c

Dr.

 

2,000

 

 

  To Advertisement A/c

 

 

 

12,000

 

(Balance of Advertisement Suspense Account is debited to Partners’ Capital Account)

 

 

 

 

 

 

 

 

 

Z’s Capital A/c

Dr.

 

3,32,000

 

 

   To Bank A/c

 

 

1,66,000

 

   To Z’s Loan A/c

 

 

1,66,000

 

(Half of the amount is immediately paid to Z and remaining half is transferred to his Loan Account)

 

 

 

 

 

 

 

 

 

Revaluation Account

Dr.

 

Cr.

Particulars

Amount

Rs

Particulars

Amount

Rs

Stock

38,000

Land and Building

20,000

Provision for Doubtful Debts

5,000

Sundry Creditors

30,000

Profit transferred to:

 

Prepaid Insurance

5,000

X’s Capital A/c

4,000

 

 

 

Y’s Capital A/c

6,000

 

 

 

Z’s Capital A/c

2,000

12,000

 

 

 

55,000

 

55,000

 

 

 

 

 

Partners’ Capital Accounts

Dr.

 

Cr.

Particulars

X

Y

Z

Particulars

X

Y

Z

Y’s Capital A/c

18,600

 

 

Balance b/d

1,00,000

2,00,000

3,00,000

Z’s Capital A/c

31,000

 

 

 

 

 

 

Advertisement Suspense A/c

4,000

6,000

2,000

Revaluation A/c

4,000

6,000

2,000

Goodwill A/c

4,000

6,000

2,000

Workmen Compensation Reserve

4,000

6,000

2,000

Bank A/c

 

 

1,66,000

Investment Fluctuation Reserve

2,000

3,000

1,000

Z’s Loan A/c

 

 

1,66,000

X’s Capital A/c

 

18,600

31,000

Balance c/d

52,400

2,21,600

 

 

 

 

 

 

1,10,000

2,33,600

3,36,000

 

1,10,000

2,33,600

3,36,000

 

 

 

 

 

 

 

 

 

Balance Sheet

as at April 01, 2016

Liabilities

Amount

Rs

Assets

Amount

Rs

Capital A/cs:

 

Investments

46,000

X

52,400

 

Land and Building

2,50,000

 

Y

2,21,600

2,74,000

Add: Undervaluation

20,000

2,70,000

Z’s Loan

1,66,000

Stock

                80,000

 

Workmen Compensation Claim

8,000

Less: Overvaluation

        38,000

42,000

Employees Provident Fund

60,000

Debtors

             3,00,000

 

Sundry Creditors

3,00,000

 

Less: Prov. For D/D

        15,000

2,85,000

Less: Written-off

30,000

2,70,000

Bank (2,96,000 – 1,66,000)

1,30,000

 

 

 

Prepaid Insurance

5,000

 

7,78,000

 

7,78,000

 

 

 

 

 

Z’s Loan Account

Dr.

 

Cr.

Date

Particulars

Amount

Rs

Date

Particulars

Amount

Rs

2016

 

 

2015

 

 

March 31

Bank A/c (83,000 + 16,600)

99,600

April 01

Z’s Capital A/c

1,66,000

March 31

Balance c/d

83,000

2016

 

 

 

 

 

March 31

Interest A/c (1,66,000 @ 10%)

16,600

 

 

1,82,600

 

 

1,82,600

2017

 

 

2016

 

 

March 31

Bank A/c (83,000 + 8,300)

91,300

April 01

Balance b/d

83,000

 

 

 

2016

 

 

 

 

 

March 31

Interest A/c (83,000 @ 10%)

8,300

 

 

91,300

 

 

91,300

 

 

 

 

 

 

Working Notes:

WN 1: Calculation of sacrificing/gaining ratio

WN 2: Calculation of goodwill



Page No 4.116:

Answer:

Partners’ Capital Accounts

Dr.

 

Cr.