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Page No 6.100:
Question 51:
Answer:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
Revaluation A/c |
Dr. |
|
10,000 |
|
To Machinery A/c |
|
|
10,000 |
|
(Decrease in value of Machinery transferred to Revaluation Account) |
|
|
|
|
|
|
|
|
|
Patents A/c |
Dr. |
|
10,000 |
|
Leasehold A/c |
Dr. |
|
25,000 |
|
To Revaluation A/c |
|
|
35,000 |
|
(Increase in value Patents and Leasehold transferred to Revaluation Account) |
|
|
|
|
|
|
|
|
|
Revaluation A/c |
Dr. |
|
25,000 |
|
To R’s Capital A/c |
|
|
12,500 |
|
To S’s Capital A/c |
|
|
7,500 |
|
To T’s Capital A/c |
|
|
5,000 |
|
(Revaluation profit distributed among partners in their old ratio) |
|
|
|
|
|
|
|
|
|
R’ Capital A/c |
Dr. |
|
12,500 |
|
S’s Capital A/c |
Dr. |
|
7,500 |
|
T’s Capital A/c |
Dr. |
|
5,000 |
|
To Goodwill A/c |
|
|
25,000 |
|
(Goodwill written off among partners in their old ratio) |
|
|
|
|
|
|
|
|
|
R’s Capital A/c |
Dr. |
|
21,875 |
|
S’s Capital A/c |
Dr. |
|
13,125 |
|
To T’s Capital A/c |
|
|
35,000 |
|
(T’s share of goodwill adjusted) |
|
|
|
|
|
|
|
|
|
Profit and Loss Suspense A/c |
Dr. |
|
5,000 |
|
To T’s Capital A/c |
|
|
5,000 |
|
(T’s share of profit transferred to his capital account) |
|
|
|
|
|
|
|
|
|
Workmen’s Compensation Reserve A/c |
Dr. |
|
30,000 |
|
To R’s Capital A/c |
|
|
15,000 |
|
To S’s Capital A/c |
|
|
9,000 |
|
To T’s Capital A/c |
|
|
6,000 |
|
(Workmen’s Compensation Reserve distributed among partners in their old ratio ) |
|
|
|
|
|
|
|
|
|
T’s Capital A/c |
Dr. |
|
1,21,000 |
|
To T’s Executors A/c |
|
|
1,21,000 |
|
(Amount due to T after all adjustments transferred to his Executor’s Account) |
|
|
|
|
|
|
|
|
|
T’s Executor’s A/c |
Dr. |
|
21,000 |
|
To Bank A/c |
|
|
21,000 |
|
(Amount paid to T’s Executor) |
|
|
|
|
|
|
|
|
T’s Executor’s Account |
|||||
Dr. |
|
Cr. |
|||
Date |
Particulars |
Amount Rs |
Date |
Particulars |
Amount Rs |
2016 |
|
|
2016 |
|
|
Aug. 01 |
Cash A/c |
21,000 |
Aug. 01 |
T’s Capital A/c |
1,21,000 |
2017 | 2017 | ||||
Feb. 01 |
Cash A/c (25,000 + 5,000) |
30,000 |
Feb. 01 |
Interest (1,00,000 ×10% for 6 months) |
5,000 |
March 31 |
Balance c/d |
76,250 |
March 31 |
Interest (75,000 ×10% for 2 months) |
1,250 |
|
|
1,27,250 |
|
|
1,27,250 |
2017 |
|
|
2017 |
|
|
August 01 |
Cash A/c (25,000 + 1,250 + 2,500) |
28,750 |
April 01 |
Balance b/d |
76,250 |
2018 |
|
|
August 01 |
Interest (75,000 × 10% for 4 months) |
2,500 |
Feb. 01 | Cash A/c (25,000 + 2,500) | 27,500 | 2018 | ||
March 31 |
Balance c/d |
25,417 |
Feb. 01 |
Interest (50,000 × 10% for 6 months) |
2,500 |
|
|
|
March 31 |
Interest (25,000 × 10% for 2 months) |
417 |
|
|
81,667 |
|
|
81,667 |
2018 |
|
|
2018 |
|
|
August 01 |
Cash A/c (25,000 + 417 + 833) |
26,250 |
April 01 |
Balance b/d |
25,417 |
|
|
|
August 01 |
Interest (25,000 × 10% for 4 months) |
833 |
|
|
26,250 |
|
|
26,250 |
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Goodwill
Goodwill = Average Profit × Number of Year’s Purchase
∴ Goodwill = Average Profit × Number of Years’ Purchase
= 70,000 × 2.5 = Rs 1,75,000
WN 2 Adjustment of Goodwill
Old Ratio (R, S and T) = 5 : 3 : 2
T died.
∴ New Ratio (R and S) = 5 : 3 and
Gaining Ratio = 5 : 3
T’s Share in Goodwill =
This share of goodwill is to be distributed between R and S in their gaining ratio (i.e. 5 : 3).
WN 3 Calculation of T’s Share of Profit
Profit for 2016-17 = Rs 75,000
WN 4
Revaluation Account |
||||
Dr. |
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Machinery |
10,000 |
Patents |
10,000 |
|
Profit transferred to: |
|
Leasehold |
25,000 |
|
R’s Capital A/c |
12,500 |
|
|
|
S’s Capital A/c |
7,500 |
|
|
|
T’s Capital A/c |
5,000 |
25,000 |
|
|
|
35,000 |
|
35,000 |
|
|
|
|
|
WN 5
T’s Capital Account |
|||
Dr. |
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
Goodwill |
5,000 |
Balance b/d |
75,000 |
T’s Executor’s A/c |
1,21,000 |
Workmen’s Compensation Reserve |
6,000 |
|
|
Profit and Loss Suspense A/c |
5,000 |
|
|
R’s Capital A/c |
21,875 |
|
|
S’s Capital A/c |
13,125 |
|
|
Revaluation A/c (Profit) |
5,000 |
|
1,26,000 |
|
1,26,000 |
|
|
|
|
Page No 6.100:
Question 52:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
Revaluation A/c |
Dr. |
|
10,000 |
|
To Machinery A/c |
|
|
10,000 |
|
(Decrease in value of Machinery transferred to Revaluation Account) |
|
|
|
|
|
|
|
|
|
Patents A/c |
Dr. |
|
10,000 |
|
Leasehold A/c |
Dr. |
|
25,000 |
|
To Revaluation A/c |
|
|
35,000 |
|
(Increase in value Patents and Leasehold transferred to Revaluation Account) |
|
|
|
|
|
|
|
|
|
Revaluation A/c |
Dr. |
|
25,000 |
|
To R’s Capital A/c |
|
|
12,500 |
|
To S’s Capital A/c |
|
|
7,500 |
|
To T’s Capital A/c |
|
|
5,000 |
|
(Revaluation profit distributed among partners in their old ratio) |
|
|
|
|
|
|
|
|
|
R’ Capital A/c |
Dr. |
|
12,500 |
|
S’s Capital A/c |
Dr. |
|
7,500 |
|
T’s Capital A/c |
Dr. |
|
5,000 |
|
To Goodwill A/c |
|
|
25,000 |
|
(Goodwill written off among partners in their old ratio) |
|
|
|
|
|
|
|
|
|
R’s Capital A/c |
Dr. |
|
21,875 |
|
S’s Capital A/c |
Dr. |
|
13,125 |
|
To T’s Capital A/c |
|
|
35,000 |
|
(T’s share of goodwill adjusted) |
|
|
|
|
|
|
|
|
|
Profit and Loss Suspense A/c |
Dr. |
|
5,000 |
|
To T’s Capital A/c |
|
|
5,000 |
|
(T’s share of profit transferred to his capital account) |
|
|
|
|
|
|
|
|
|
Workmen’s Compensation Reserve A/c |
Dr. |
|
30,000 |
|
To R’s Capital A/c |
|
|
15,000 |
|
To S’s Capital A/c |
|
|
9,000 |
|
To T’s Capital A/c |
|
|
6,000 |
|
(Workmen’s Compensation Reserve distributed among partners in their old ratio ) |
|
|
|
|
|
|
|
|
|
T’s Capital A/c |
Dr. |
|
1,21,000 |
|
To T’s Executors A/c |
|
|
1,21,000 |
|
(Amount due to T after all adjustments transferred to his Executor’s Account) |
|
|
|
|
|
|
|
|
|
T’s Executor’s A/c |
Dr. |
|
21,000 |
|
To Bank A/c |
|
|
21,000 |
|
(Amount paid to T’s Executor) |
|
|
|
|
|
|
|
|
T’s Executor’s Account |
|||||
Dr. |
|
Cr. |
|||
Date |
Particulars |
Amount Rs |
Date |
Particulars |
Amount Rs |
2016 |
|
|
2016 |
|
|
Aug. 01 |
Cash A/c |
21,000 |
Aug. 01 |
T’s Capital A/c |
1,21,000 |
2017 | 2017 | ||||
Feb. 01 |
Cash A/c (25,000 + 5,000) |
30,000 |
Feb. 01 |
Interest (1,00,000 ×10% for 6 months) |
5,000 |
March 31 |
Balance c/d |
76,250 |
March 31 |
Interest (75,000 ×10% for 2 months) |
1,250 |
|
|
1,27,250 |
|
|
1,27,250 |
2017 |
|
|
2017 |
|
|
August 01 |
Cash A/c (25,000 + 1,250 + 2,500) |
28,750 |
April 01 |
Balance b/d |
76,250 |
2018 |
|
|
August 01 |
Interest (75,000 × 10% for 4 months) |
2,500 |
Feb. 01 | Cash A/c (25,000 + 2,500) | 27,500 | 2018 | ||
March 31 |
Balance c/d |
25,417 |
Feb. 01 |
Interest (50,000 × 10% for 6 months) |
2,500 |
|
|
|
March 31 |
Interest (25,000 × 10% for 2 months) |
417 |
|
|
81,667 |
|
|
81,667 |
2018 |
|
|
2018 |
|
|
August 01 |
Cash A/c (25,000 + 417 + 833) |
26,250 |
April 01 |
Balance b/d |
25,417 |
|
|
|
August 01 |
Interest (25,000 × 10% for 4 months) |
833 |
|
|
26,250 |
|
|
26,250 |
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Goodwill
Goodwill = Average Profit × Number of Year’s Purchase
∴ Goodwill = Average Profit × Number of Years’ Purchase
= 70,000 × 2.5 = Rs 1,75,000
WN 2 Adjustment of Goodwill
Old Ratio (R, S and T) = 5 : 3 : 2
T died.
∴ New Ratio (R and S) = 5 : 3 and
Gaining Ratio = 5 : 3
T’s Share in Goodwill =
This share of goodwill is to be distributed between R and S in their gaining ratio (i.e. 5 : 3).
WN 3 Calculation of T’s Share of Profit
Profit for 2016-17 = Rs 75,000
WN 4
Revaluation Account |
||||
Dr. |
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Machinery |
10,000 |
Patents |
10,000 |
|
Profit transferred to: |
|
Leasehold |
25,000 |
|
R’s Capital A/c |
12,500 |
|
|
|
S’s Capital A/c |
7,500 |
|
|
|
T’s Capital A/c |
5,000 |
25,000 |
|
|
|
35,000 |
|
35,000 |
|
|
|
|
|
WN 5
T’s Capital Account |
|||
Dr. |
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
Goodwill |
5,000 |
Balance b/d |
75,000 |
T’s Executor’s A/c |
1,21,000 |
Workmen’s Compensation Reserve |
6,000 |
|
|
Profit and Loss Suspense A/c |
5,000 |
|
|
R’s Capital A/c |
21,875 |
|
|
S’s Capital A/c |
13,125 |
|
|
Revaluation A/c (Profit) |
5,000 |
|
1,26,000 |
|
1,26,000 |
|
|
|
|
Answer:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
Workmen’s Compensation Reserve |
Dr. |
|
6,000 |
|
To X’s Capital A/c |
|
|
3,000 |
|
To Y’s Capital A/c |
|
|
2,000 |
|
To Z’s Capital A/c |
|
|
1,000 |
|
(Workmen’s Compesation Reserve distributed among partners in their old ratio) |
|
|
|
|
|
|
|
|
|
General Reserve A/c |
Dr. |
|
6,000 |
|
To X’s Capital A/c |
|
|
3,000 |
|
To Y’s Capital A/c |
|
|
2,000 |
|
To Z’s Capital A/c |
|
|
1,000 |
|
(General Reserve distributed among partners in their old ratio) |
|
|
|
|
|
|
|
|
|
X’s Capital A/c |
Dr. |
|
3,000 |
|
Y’s Capital A/c |
Dr. |
|
2,000 |
|
Z’s Capital A/c |
Dr. |
|
1,000 |
|
To Advertisement Suspense A/c |
|
|
6,000 |
|
(Advertisement suspense written off among partners in their old ratio) |
|
|
|
|
|
|
|
|
|
X’s Capital A/c |
Dr. |
|
4,500 |
|
Y’s Capital A/c |
Dr. |
|
3,000 |
|
To Z’s Capital A/c |
|
|
7,500 |
|
(Z’s share of goodwill adjusted ) |
|
|
|
|
|
|
|
|
|
Revaluation A/c |
Dr. |
|
3,600 |
|
To Sundry debtors A/c |
Dr. |
|
|
1,000 |
To Furniture A/c |
|
|
500 |
|
To Plant and Machinery A/c |
|
|
1,500 |
|
To Bills Receivable A/c |
|
|
600 |
|
(Decrease in value of Assets transferred to Revaluation Account) |
|
|
|
|
|
|
|
|
|
Stock A/c |
Dr. |
|
1,000 |
|
Building A/c |
Dr. |
|
5,000 |
|
To Revaluation A/c |
|
|
6,000 |
|
(Increase in value of Assets transferred to Revaluation Account) |
|
|
|
|
|
|
|
|
|
Revaluation A/c |
Dr. |
|
2,400 |
|
To X’ Capital A/c |
|
|
1,200 |
|
To Y’s Capital A/c |
|
|
800 |
|
To Z’s Capital A/c |
|
|
400 |
|
(Revaluation profit distributed among partners in their old ratio) |
|
|
|
|
|
|
|
|
|
Profit and Loss Suspense A/c |
Dr. |
|
1,333 |
|
To Z’s Capital A/c |
|
|
1,333 |
|
(Z’s share of profit transferred his capital account) |
|
|
|
|
|
|
|
|
|
Z’s Capital A/c |
Dr. |
|
22,233 |
|
To Z’s Executor’s A/c |
|
|
22,233 |
|
(Amount due to Z transferred to his Executor’s Account) |
|
|
|
|
|
|
|
|
|
Z’s Executor’s A/c |
Dr. |
|
12,333 |
|
To Bank A/c |
|
|
12,333 |
|
(Amount paid to Z’s Executor) |
|
|
|
|
|
|
|
|
Z’s Executor’s Account |
|||||
Dr. |
|
Cr. |
|||
Date |
Particulars |
Amount Rs |
Date |
Particulars |
Amount Rs |
2015 |
|
|
2015 |
|
|
April 30 |
Bank A/c |
12,233 |
April 30 |
Z’s Capital A/c |
22,233 |
Dec. 31 |
Balance c/d |
10,667 |
Dec. 31 |
Interest (10,000 × 10% for 8 months) |
667 |
|
|
22,900 |
|
|
22,900 |
2016 |
|
|
2016 |
|
|
April 30 |
Bank A/c (5,000 + 667 + 333) |
6,000 |
Jan. 01 |
Balance b/d |
10,667 |
|
|
|
April 30 |
Interest (10,000 × 10% for 4 months ) |
333 |
|
Balance c/d |
5,333 |
Dec. 31 |
Interest (5,000 × 10% for 8 months) |
333 |
|
|
11,333 |
|
|
11,333 |
2017 |
|
|
2017 |
|
|
April 30 |
Bank A/c (5,000 + 333 + 167) |
5,500 |
April 01 |
Balance b/d |
5,333 |
|
|
|
April 30 |
Interest (5,000 × 10% for 4months) |
167 |
|
|
5,500 |
|
|
5,500 |
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Goodwill
Goodwill = Average Profit × Number of Year’s Purchase
∴ Goodwill = Average Profit × Number of Years’ Purchase
= 15,000 × 3 = Rs 45,000
WN 2 Adjustment of Goodwill
Old Ratio = 3 : 2 : 1
Z died.
∴ New Ratio (X and Y) = 3 : 1 and
Gaining Ratio = 3 : 2
Z’s Share in Goodwill =
This share of goodwill is to be distributed between X and Y in their gaining ratio (i.e. 3 : 1).
WN 3 Calculation Z’s Share of Profit
Profit for Previous Year = Rs 24,000
∴ Z’s Profit Share
WN 4
Revaluation Account |
||||
Dr. |
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Sundry Debtors |
1,000 |
Stock |
1,000 |
|
Furniture |
500 |
Building |
5,000 |
|
Plant and Machinery |
1,500 |
|
|
|
Bills Receivable |
600 |
|
|
|
Profit transferred to: |
|
|
|
|
X’s Capital A/c |
1,200 |
|
|
|
Y’s Capital A/c |
800 |
|
|
|
Z’s Capital A/c |
400 |
2,400 |
|
|
|
6,000 |
|
6,000 |
|
|
|
|
|
Page No 6.101:
Question 53:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
Workmen’s Compensation Reserve |
Dr. |
|
6,000 |
|
To X’s Capital A/c |
|
|
3,000 |
|
To Y’s Capital A/c |
|
|
2,000 |
|
To Z’s Capital A/c |
|
|
1,000 |
|
(Workmen’s Compesation Reserve distributed among partners in their old ratio) |
|
|
|
|
|
|
|
|
|
General Reserve A/c |
Dr. |
|
6,000 |
|
To X’s Capital A/c |
|
|
3,000 |
|
To Y’s Capital A/c |
|
|
2,000 |
|
To Z’s Capital A/c |
|
|
1,000 |
|
(General Reserve distributed among partners in their old ratio) |
|
|
|
|
|
|
|
|
|
X’s Capital A/c |
Dr. |
|
3,000 |
|
Y’s Capital A/c |
Dr. |
|
2,000 |
|
Z’s Capital A/c |
Dr. |
|
1,000 |
|
To Advertisement Suspense A/c |
|
|
6,000 |
|
(Advertisement suspense written off among partners in their old ratio) |
|
|
|
|
|
|
|
|
|
X’s Capital A/c |
Dr. |
|
4,500 |
|
Y’s Capital A/c |
Dr. |
|
3,000 |
|
To Z’s Capital A/c |
|
|
7,500 |
|
(Z’s share of goodwill adjusted ) |
|
|
|
|
|
|
|
|
|
Revaluation A/c |
Dr. |
|
3,600 |
|
To Sundry debtors A/c |
Dr. |
|
|
1,000 |
To Furniture A/c |
|
|
500 |
|
To Plant and Machinery A/c |
|
|
1,500 |
|
To Bills Receivable A/c |
|
|
600 |
|
(Decrease in value of Assets transferred to Revaluation Account) |
|
|
|
|
|
|
|
|
|
Stock A/c |
Dr. |
|
1,000 |
|
Building A/c |
Dr. |
|
5,000 |
|
To Revaluation A/c |
|
|
6,000 |
|
(Increase in value of Assets transferred to Revaluation Account) |
|
|
|
|
|
|
|
|
|
Revaluation A/c |
Dr. |
|
2,400 |
|
To X’ Capital A/c |
|
|
1,200 |
|
To Y’s Capital A/c |
|
|
800 |
|
To Z’s Capital A/c |
|
|
400 |
|
(Revaluation profit distributed among partners in their old ratio) |
|
|
|
|
|
|
|
|
|
Profit and Loss Suspense A/c |
Dr. |
|
1,333 |
|
To Z’s Capital A/c |
|
|
1,333 |
|
(Z’s share of profit transferred his capital account) |
|
|
|
|
|
|
|
|
|
Z’s Capital A/c |
Dr. |
|
22,233 |
|
To Z’s Executor’s A/c |
|
|
22,233 |
|
(Amount due to Z transferred to his Executor’s Account) |
|
|
|
|
|
|
|
|
|
Z’s Executor’s A/c |
Dr. |
|
12,333 |
|
To Bank A/c |
|
|
12,333 |
|
(Amount paid to Z’s Executor) |
|
|
|
|
|
|
|
|
Z’s Executor’s Account |
|||||
Dr. |
|
Cr. |
|||
Date |
Particulars |
Amount Rs |
Date |
Particulars |
Amount Rs |
2015 |
|
|
2015 |
|
|
April 30 |
Bank A/c |
12,233 |
April 30 |
Z’s Capital A/c |
22,233 |
Dec. 31 |
Balance c/d |
10,667 |
Dec. 31 |
Interest (10,000 × 10% for 8 months) |
667 |
|
|
22,900 |
|
|
22,900 |
2016 |
|
|
2016 |
|
|
April 30 |
Bank A/c (5,000 + 667 + 333) |
6,000 |
Jan. 01 |
Balance b/d |
10,667 |
|
|
|
April 30 |
Interest (10,000 × 10% for 4 months ) |
333 |
|
Balance c/d |
5,333 |
Dec. 31 |
Interest (5,000 × 10% for 8 months) |
333 |
|
|
11,333 |
|
|
11,333 |
2017 |
|
|
2017 |
|
|
April 30 |
Bank A/c (5,000 + 333 + 167) |
5,500 |
April 01 |
Balance b/d |
5,333 |
|
|
|
April 30 |
Interest (5,000 × 10% for 4months) |
167 |
|
|
5,500 |
|
|
5,500 |
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Goodwill
Goodwill = Average Profit × Number of Year’s Purchase
∴ Goodwill = Average Profit × Number of Years’ Purchase
= 15,000 × 3 = Rs 45,000
WN 2 Adjustment of Goodwill
Old Ratio = 3 : 2 : 1
Z died.
∴ New Ratio (X and Y) = 3 : 1 and
Gaining Ratio = 3 : 2
Z’s Share in Goodwill =
This share of goodwill is to be distributed between X and Y in their gaining ratio (i.e. 3 : 1).
WN 3 Calculation Z’s Share of Profit
Profit for Previous Year = Rs 24,000
∴ Z’s Profit Share
WN 4
Revaluation Account |
||||
Dr. |
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Sundry Debtors |
1,000 |
Stock |
1,000 |
|
Furniture |
500 |
Building |
5,000 |
|
Plant and Machinery |
1,500 |
|
|
|
Bills Receivable |
600 |
|
|
|
Profit transferred to: |
|
|
|
|
X’s Capital A/c |
1,200 |
|
|
|
Y’s Capital A/c |
800 |
|
|
|
Z’s Capital A/c |
400 |
2,400 |
|
|
|
6,000 |
|
6,000 |
|
|
|
|
|
Answer:
Black’s Executor’s Account | |||||
Dr. | Cr. | ||||
Particulars | Amount Rs |
Particulars | Amount Rs |
||
Black’s Executor’s Loan A/c | 1,28,000 | Balance b/d | 60,000 | ||
Reserves A/c (WN1) | 12,000 | ||||
Profit and Loss Suspense A/c (WN 2) | 5,600 | ||||
Brown’s Capital A/c (WN 3) | 50,400 | ||||
1,28,000 | 1,28,000 | ||||
Working Notes:
Profit Sharing Ratio between Brown and Black is 3 : 2
WN 1: Calculation of Share of Reserve
WN 2: Calculation of Share of Profits
Total Profit = 42,000 + 39,000 + 45,000 = Rs 1,26,000
Black’s Share =
WN 3: Calculation of Share of Goodwill
Average Profit = Rs 42,000
Goodwill = 42,000 × 3 = Rs 1,26,000
Black’s Share =
Page No 6.101:
Question 54:
Black’s Executor’s Account | |||||
Dr. | Cr. | ||||
Particulars | Amount Rs |
Particulars | Amount Rs |
||
Black’s Executor’s Loan A/c | 1,28,000 | Balance b/d | 60,000 | ||
Reserves A/c (WN1) | 12,000 | ||||
Profit and Loss Suspense A/c (WN 2) | 5,600 | ||||
Brown’s Capital A/c (WN 3) | 50,400 | ||||
1,28,000 | 1,28,000 | ||||
Working Notes:
Profit Sharing Ratio between Brown and Black is 3 : 2
WN 1: Calculation of Share of Reserve
WN 2: Calculation of Share of Profits
Total Profit = 42,000 + 39,000 + 45,000 = Rs 1,26,000
Black’s Share =
WN 3: Calculation of Share of Goodwill
Average Profit = Rs 42,000
Goodwill = 42,000 × 3 = Rs 1,26,000
Black’s Share =
Answer:
Revaluation Account | ||||||
Dr. | Cr. | |||||
Particulars | Amount Rs | Particulars | Amount Rs | |||
Stock A/c | 1,500 | Land and Building A/c | 25,000 | |||
Provision for Doubtful Debts A/c | 2,000 | |||||
Profit transferred to: | ||||||
X’s Capital A/c
|
8,500 | |||||
Y’s Capital A/c
|
8,500 | |||||
Z’s Capital A/c
|
8,500 | 25,500 | ||||
27,000 | 27,000 | |||||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | X | Y | Z | Particulars | X | Y | Z | ||
Z’s Capital A/c | 4,375 | 4,375 | Balance b/d | 75,000 | 50,000 | 50,000 | |||
Goodwill A/c | 15,750 | 15,750 | 15,750 | Profit & Loss Suspense A/c | 1,875 | ||||
Z’s Executor A/c | 56,925 | Revaluation A/c | 8,500 | 8,500 | 8,500 | ||||
Balance c/d | 66,925 | 41,925 | X’s Capital A/c | 4,375 | |||||
Y’s Capital A/c | 4,375 | ||||||||
Investment Fluctuation Reserve | 550 | 550 | 550 | ||||||
Contingency Reserve | 3,000 | 3,000 | 3,000 | ||||||
87,050 | 62,050 | 72,675 | 87,050 | 62,050 | 72,675 | ||||
Balance Sheet
as on April 01, 2010 after Z’s death
|
||||
Liabilities | Amount Rs | Assets | Amount Rs | |
Z’s Executor | 56,925 | Cash | 2,500 | |
Capital A/cs: | Bank | 10,000 | ||
X
|
66,925 | Debtors | 25,000 | |
Y
|
41,925 | 1,08,850 | Stock | 23,500 |
Creditors | 33,250 | Land and Building | 1,25,000 | |
Investment Fluctuation Reserve | 1,350 | Investments (at Cost) | 12,500 | |
Profit and Loss Suspense A/c | 1,875 | |||
2,00,375 | 2,00,375 | |||
Working Notes:
1. Investment Fluctuation Reserve is required only upto Rs 1,350, the balance of Rs 1,650 is credited to Partner’s Capital A/c in their old profit sharing ratio.
2. Goodwill already appearing in the books of accounts is to be written off in old ratio
3. Calculation of Goodwill:
Total Profit = 28,750 + 35,000 + 22,500 + 20,000 + 25,000 = Rs 1,31,250
Goodwill = 26,250 × 1 = Rs 26,250
Z’s share =
Since no information about new ratio is given, it is assumed that partner’s will gain in their old ratio which is 1 : 1.
4. Profit share of Z
Average Profit for 3 years =
Total Profit = 22,500 + 20,000 + 25,000 = Rs 67,500
Z’s Share =
Page No 6.102:
Question 55:
Revaluation Account | ||||||
Dr. | Cr. | |||||
Particulars | Amount Rs | Particulars | Amount Rs | |||
Stock A/c | 1,500 | Land and Building A/c | 25,000 | |||
Provision for Doubtful Debts A/c | 2,000 | |||||
Profit transferred to: | ||||||
X’s Capital A/c
|
8,500 | |||||
Y’s Capital A/c
|
8,500 | |||||
Z’s Capital A/c
|
8,500 | 25,500 | ||||
27,000 | 27,000 | |||||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | X | Y | Z | Particulars | X | Y | Z | ||
Z’s Capital A/c | 4,375 | 4,375 | Balance b/d | 75,000 | 50,000 | 50,000 | |||
Goodwill A/c | 15,750 | 15,750 | 15,750 | Profit & Loss Suspense A/c | 1,875 | ||||
Z’s Executor A/c | 56,925 | Revaluation A/c | 8,500 | 8,500 | 8,500 | ||||
Balance c/d | 66,925 | 41,925 | X’s Capital A/c | 4,375 | |||||
Y’s Capital A/c | 4,375 | ||||||||
Investment Fluctuation Reserve | 550 | 550 | 550 | ||||||
Contingency Reserve | 3,000 | 3,000 | 3,000 | ||||||
87,050 | 62,050 | 72,675 | 87,050 | 62,050 | 72,675 | ||||
Balance Sheet
as on April 01, 2010 after Z’s death
|
||||
Liabilities | Amount Rs | Assets | Amount Rs | |
Z’s Executor | 56,925 | Cash | 2,500 | |
Capital A/cs: | Bank | 10,000 | ||
X
|
66,925 | Debtors | 25,000 | |
Y
|
41,925 | 1,08,850 | Stock | 23,500 |
Creditors | 33,250 | Land and Building | 1,25,000 | |
Investment Fluctuation Reserve | 1,350 | Investments (at Cost) | 12,500 | |
Profit and Loss Suspense A/c | 1,875 | |||
2,00,375 | 2,00,375 | |||
Working Notes:
1. Investment Fluctuation Reserve is required only upto Rs 1,350, the balance of Rs 1,650 is credited to Partner’s Capital A/c in their old profit sharing ratio.
2. Goodwill already appearing in the books of accounts is to be written off in old ratio
3. Calculation of Goodwill:
Total Profit = 28,750 + 35,000 + 22,500 + 20,000 + 25,000 = Rs 1,31,250
Goodwill = 26,250 × 1 = Rs 26,250
Z’s share =
Since no information about new ratio is given, it is assumed that partner’s will gain in their old ratio which is 1 : 1.
4. Profit share of Z
Average Profit for 3 years =
Total Profit = 22,500 + 20,000 + 25,000 = Rs 67,500
Z’s Share =
Answer:
Bharati’s Capital Account | |||||
Dr. | Cr. | ||||
Particulars | Amount Rs |
Particulars | Amount Rs |
||
Bharati’s Executor’s A/c | 26,300 | Balance b/d | 12,000 | ||
Interest on Capital A/c | 300 | ||||
General Reserve A/c | 4,000 | ||||
Profit and Loss Suspense A/c | 4,000 | ||||
Arti’s Capital A/c | 4,500 | ||||
Seema’s Capital A/c | 1,500 | ||||
26,300 | 26,300 | ||||
Working Notes:
WN 1: Calculation of Interest on Capital
WN 2: Calculation of Profit share
10% of Sales =
Bharati’s Share =
WN 3: Calculation of Goodwill
Average profit of 3 years × 2 years of purchase
Total Profit = 8,200 + 9,000 + 9,800 = Rs 27,000
Goodwill = 9,000 × 2 = Rs 18,000
Bharti’s Share =
Since no information about new ratio is given, it is assumed that partner’s will gain in their old ratio which is 3 : 1.
Note: The answer given in the book is Rs 26,000. However, as per the solution provided, the actual amount payable to Bharati's Executor is Rs 26,300.
Page No 6.102:
Question 56:
Bharati’s Capital Account | |||||
Dr. | Cr. | ||||
Particulars | Amount Rs |
Particulars | Amount Rs |
||
Bharati’s Executor’s A/c | 26,300 | Balance b/d | 12,000 | ||
Interest on Capital A/c | 300 | ||||
General Reserve A/c | 4,000 | ||||
Profit and Loss Suspense A/c | 4,000 | ||||
Arti’s Capital A/c | 4,500 | ||||
Seema’s Capital A/c | 1,500 | ||||
26,300 | 26,300 | ||||
Working Notes:
WN 1: Calculation of Interest on Capital
WN 2: Calculation of Profit share
10% of Sales =
Bharati’s Share =
WN 3: Calculation of Goodwill
Average profit of 3 years × 2 years of purchase
Total Profit = 8,200 + 9,000 + 9,800 = Rs 27,000
Goodwill = 9,000 × 2 = Rs 18,000
Bharti’s Share =
Since no information about new ratio is given, it is assumed that partner’s will gain in their old ratio which is 3 : 1.
Note: The answer given in the book is Rs 26,000. However, as per the solution provided, the actual amount payable to Bharati's Executor is Rs 26,300.
Answer:
Books of | ||||||
Journal | ||||||
Date | Particulars | L.F. | Debit Amount Rs |
Credit Amount Rs |
||
Building A/c | Dr. | 5,000 | ||||
Stock A/c | Dr. | 1,000 | ||||
To Revaluation A/c
|
6,000 | |||||
(Value of assets has increased) | ||||||
Revaluation A/c | Dr. | 3,600 | ||||
To Debtors A/c
|
1,000 | |||||
To Furniture A/c
|
500 | |||||
To Plant and Machinery A/c
|
1,500 | |||||
To Bills Receivable
|
600 | |||||
(Value of assets has decreased) | ||||||
Revaluation A/c | Dr. | 2,400 | ||||
To P’s Capital A/c
|
1,200 | |||||
To Q’s Capital A/c
|
800 | |||||
To R’s Capital A/c
|
400 | |||||
(Profit on Revaluation credited to Partner’s Capital A/c) | ||||||
Profit and Loss Suspense A/c | Dr. | 1,333 | ||||
To R’s Executor A/c
|
1,333 | |||||
(R’s share of Profit credited to his account) | ||||||
P’s Capital A/c | Dr. | 4,500 | ||||
Q’s Capital A/c | Dr. | 3,000 | ||||
To R’s Capital A/c
|
7,500 | |||||
(R’s share of goodwill credited to his account and debited to P and Q in their gaining ratio.) | ||||||
Reserve | Dr. | 6,000 | ||||
To P’s Capital A/c
|
3,000 | |||||
To Q’s Capital A/c
|
2,000 | |||||
To R’s Capital A/c
|
1,000 | |||||
(Reserve credited to Partner’s Capital Account in their old ratio.) |
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | P | Q | R | Particulars | P | Q | R | ||
R’s Capital A/c | 4,500 | 3,000 | Balance b/d | 22,750 | 15,250 | 12,000 | |||
R’s Executor A/c | 22,233 | Reserve A/c | 3,000 | 2,000 | 1,000 | ||||
Balance c/d | 22,450 | 15,050 | Profit & Loss Suspense A/c | 1,333 | |||||
Revaluation A/c | 1,200 | 800 | 400 | ||||||
P’s Capital A/c | 4,500 | ||||||||
Q’s Capital A/c | 3,000 | ||||||||
26,950 | 18,050 | 22,233 | 26,950 | 18,050 | 22,233 | ||||
R’s Executor’s Account | |||||
Dr. | Cr. | ||||
Particulars | Amount Rs |
Particulars | Amount Rs |
||
Bank A/c | 12,900 | Balance b/d | 22,233 | ||
R’s Executor’s Loan A/c | 9,333 | ||||
22,233 | 22,233 | ||||
Balance Sheet
as on July 31, 2015 after R’s death
|
||||
Liabilities | Amount Rs |
Assets | Amount Rs |
|
Cash at Bank | 5,800 | |||
Capital A/cs: | Bills Receivable (800 – 600) | 200 | ||
P
|
22,450 | Debtors | 15,000 | |
Q
|
15,050 | 37,500 | Stock | 10,000 |
Creditors | 5,000 | Building | 35,000 | |
Bills Payable | 2,000 | Furniture | 1,500 | |
Loans (7,100 + 12,900) | 20,000 | Plant and Machinery | 5,000 | |
R’s Executor’s A/c | 9,333 | Profit and Loss Suspense A/c | 1,333 | |
73,833 | 73,833 | |||
Working Notes:
1. Profit =
2. Total Profit = 24,000 + 16,000 + 20,000 + 10,000 + 5,000 = Rs 75,000
Goodwill = Average Profit of 5 Years’ × 3 Years’ of Purchase
Goodwill = 15,000 × 3 = Rs 45,000
R’s share =
Page No 6.103:
Question 57:
Books of | ||||||
Journal | ||||||
Date | Particulars | L.F. | Debit Amount Rs |
Credit Amount Rs |
||
Building A/c | Dr. | 5,000 | ||||
Stock A/c | Dr. | 1,000 | ||||
To Revaluation A/c
|
6,000 | |||||
(Value of assets has increased) | ||||||
Revaluation A/c | Dr. | 3,600 | ||||
To Debtors A/c
|
1,000 | |||||
To Furniture A/c
|
500 | |||||
To Plant and Machinery A/c
|
1,500 | |||||
To Bills Receivable
|
600 | |||||
(Value of assets has decreased) | ||||||
Revaluation A/c | Dr. | 2,400 | ||||
To P’s Capital A/c
|
1,200 | |||||
To Q’s Capital A/c
|
800 | |||||
To R’s Capital A/c
|
400 | |||||
(Profit on Revaluation credited to Partner’s Capital A/c) | ||||||
Profit and Loss Suspense A/c | Dr. | 1,333 | ||||
To R’s Executor A/c
|
1,333 | |||||
(R’s share of Profit credited to his account) | ||||||
P’s Capital A/c | Dr. | 4,500 | ||||
Q’s Capital A/c | Dr. | 3,000 | ||||
To R’s Capital A/c
|
7,500 | |||||
(R’s share of goodwill credited to his account and debited to P and Q in their gaining ratio.) | ||||||
Reserve | Dr. | 6,000 | ||||
To P’s Capital A/c
|
3,000 | |||||
To Q’s Capital A/c
|
2,000 | |||||
To R’s Capital A/c
|
1,000 | |||||
(Reserve credited to Partner’s Capital Account in their old ratio.) |
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | P | Q | R | Particulars | P | Q | R | ||
R’s Capital A/c | 4,500 | 3,000 | Balance b/d | 22,750 | 15,250 | 12,000 | |||
R’s Executor A/c | 22,233 | Reserve A/c | 3,000 | 2,000 | 1,000 | ||||
Balance c/d | 22,450 | 15,050 | Profit & Loss Suspense A/c | 1,333 | |||||
Revaluation A/c | 1,200 | 800 | 400 | ||||||
P’s Capital A/c | 4,500 | ||||||||
Q’s Capital A/c | 3,000 | ||||||||
26,950 | 18,050 | 22,233 | 26,950 | 18,050 | 22,233 | ||||
R’s Executor’s Account | |||||
Dr. | Cr. | ||||
Particulars | Amount Rs |
Particulars | Amount Rs |
||
Bank A/c | 12,900 | Balance b/d | 22,233 | ||
R’s Executor’s Loan A/c | 9,333 | ||||
22,233 | 22,233 | ||||
Balance Sheet
as on July 31, 2015 after R’s death
|
||||
Liabilities | Amount Rs |
Assets | Amount Rs |
|
Cash at Bank | 5,800 | |||
Capital A/cs: | Bills Receivable (800 – 600) | 200 | ||
P
|
22,450 | Debtors | 15,000 | |
Q
|
15,050 | 37,500 | Stock | 10,000 |
Creditors | 5,000 | Building | 35,000 | |
Bills Payable | 2,000 | Furniture | 1,500 | |
Loans (7,100 + 12,900) | 20,000 | Plant and Machinery | 5,000 | |
R’s Executor’s A/c | 9,333 | Profit and Loss Suspense A/c | 1,333 | |
73,833 | 73,833 | |||
Working Notes:
1. Profit =
2. Total Profit = 24,000 + 16,000 + 20,000 + 10,000 + 5,000 = Rs 75,000
Goodwill = Average Profit of 5 Years’ × 3 Years’ of Purchase
Goodwill = 15,000 × 3 = Rs 45,000
R’s share =
Answer:
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | P | Q | R | Particulars | P | Q | R | ||
R’s Capital A/c | 7,900 | 3,950 | Balance b/d | 15,000 | 10,000 | 10,000 | |||
Drawings A/c | 5,000 | Reserve Fund A/c | 10,000 | 5,000 | 5,000 | ||||
R’s Executor A/c | 22,936 | Profit & Loss Suspense A/c | 1,086 | ||||||
Balance c/d | 17,100 | 11,050 | P’s Capital A/c | 7,900 | |||||
Q’s Capital A/c | 3,950 | ||||||||
25,000 | 15,000 | 27,936 | 25,000 | 15,000 | 27,936 | ||||
R’s Executor’s Account | |||||
Dr. | Cr. | ||||
Particulars | Amount Rs |
Particulars | Amount Rs |
||
Bank A/c | 22,936 | Balance b/d | 22,936 | ||
22,936 | 22,936 | ||||
Balance Sheet
as on July 01, 2016 after R’s death
|
||||
Liabilities | Amount Rs | Assets | Amount Rs | |
Creditors | 25,000 | Building | 26,000 | |
Capital A/cs: | Debtors | 15,000 | ||
P
|
17,100 | Bills Receivable | 6,000 | |
Q
|
11,050 | 28,150 | Stock | 12,000 |
Bank Overdraft | 6,936 | Profit and Loss Suspense A/c | 1,086 | |
60,086 | 60,086 | |||
Working Notes:
WN 1: Calculation of Share of Profit
Total Profit = 16,000 + 16,000 + 15,400 = Rs 47,400
Total Profits = 15,800 + 1,580 (10% of 15,800) = Rs 17,380
R’s Share =
WN 2: Calculation of Goodwill
Goodwill = Total Profits = Rs 47,400
R’s Share =
Bank A/c | |||||
Dr. | Cr. | ||||
Particulars | Amount Rs | Particulars | Amount Rs | ||
Balance b/d | 6,000 | R’s Executors’ A/c | 22,936 | ||
Investments | 15,000 | R’s Capital A/c | 5,000 | ||
Balance c/d | 6,936 | ||||
27,936 | 27,936 | ||||
Page No 6.103:
Question 58:
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | P | Q | R | Particulars | P | Q | R | ||
R’s Capital A/c | 7,900 | 3,950 | Balance b/d | 15,000 | 10,000 | 10,000 | |||
Drawings A/c | 5,000 | Reserve Fund A/c | 10,000 | 5,000 | 5,000 | ||||
R’s Executor A/c | 22,936 | Profit & Loss Suspense A/c | 1,086 | ||||||
Balance c/d | 17,100 | 11,050 | P’s Capital A/c | 7,900 | |||||
Q’s Capital A/c | 3,950 | ||||||||
25,000 | 15,000 | 27,936 | 25,000 | 15,000 | 27,936 | ||||
R’s Executor’s Account | |||||
Dr. | Cr. | ||||
Particulars | Amount Rs |
Particulars | Amount Rs |
||
Bank A/c | 22,936 | Balance b/d | 22,936 | ||
22,936 | 22,936 | ||||
Balance Sheet
as on July 01, 2016 after R’s death
|
||||
Liabilities | Amount Rs | Assets | Amount Rs | |
Creditors | 25,000 | Building | 26,000 | |
Capital A/cs: | Debtors | 15,000 | ||
P
|
17,100 | Bills Receivable | 6,000 | |
Q
|
11,050 | 28,150 | Stock | 12,000 |
Bank Overdraft | 6,936 | Profit and Loss Suspense A/c | 1,086 | |
60,086 | 60,086 | |||
Working Notes:
WN 1: Calculation of Share of Profit
Total Profit = 16,000 + 16,000 + 15,400 = Rs 47,400
Total Profits = 15,800 + 1,580 (10% of 15,800) = Rs 17,380
R’s Share =
WN 2: Calculation of Goodwill
Goodwill = Total Profits = Rs 47,400
R’s Share =
Bank A/c | |||||
Dr. | Cr. | ||||
Particulars | Amount Rs | Particulars | Amount Rs | ||
Balance b/d | 6,000 | R’s Executors’ A/c | 22,936 | ||
Investments | 15,000 | R’s Capital A/c | 5,000 | ||
Balance c/d | 6,936 | ||||
27,936 | 27,936 | ||||
Answer:
Revaluation Account | ||||||
Dr. | Cr. | |||||
Particulars | Amount Rs |
Particulars | Amount Rs |
|||
Provision for Doubtful Debts A/c | 1,800 | Furniture A/c | 3,750 | |||
Machinery A/c | 12,000 | Stock A/c | 3,200 | |||
Advertisement Expenses A/c | 2,100 | |||||
Loss transferred to: | ||||||
X’s Capital A/c
|
2,375 | |||||
Y’s Capital A/c
|
1,583 | |||||
Z’s Capital A/c
|
792 | 4,750 | ||||
13,800 | 13,800 | |||||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | X | Y | Z | Particulars | X | Y | Z | ||
Balance b/d (Current A/c) | 5,000 | Balance b/d (Capital A/c) | 1,50,000 | 1,00,000 | 50,000 | ||||
Revaluation A/c | 2,375 | 1,583 | 792 | Balance b/d (Current A/c) | 8,000 | 2,500 | |||
Z’s Capital A/c | 3,000 | 2,000 | Workmen Compensation Reserve A/c | 3,000 | 2,000 | 1,000 | |||
Z’s Executor A/c | 54,208 | X’s Capital A/c | 3,000 | ||||||
Balance c/d | 1,67,625 | 1,08,917 | Y’s Capital A/c | 2,000 | |||||
General Reserve A/c | 12,000 | 8,000 | 4,000 | ||||||
1,73,000 | 1,12,500 | 60,000 | 1,73,000 | 1,12,500 | 60,000 | ||||
Z’s Executor’s Account | |||||||
Dr. | Cr. | ||||||
Date | Particulars | Amount Rs |
Date | Particulars | Amount Rs |
||
2013 | 2013 | ||||||
Sep. 30 | Bank A/c | 29,272 | April 01 | Balance b/d | 54,208 | ||
2014 | Sep. 30 | Interest A/c (WN 2) | 2,168 | ||||
March 31 | Bank A/c | 28,188 | 2014 | ||||
March 31 | Interest A/c (WN 2) | 1,084 | |||||
57,460 | 57,460 | ||||||
Working Notes:
WN 1: Calculation of Share of Goodwill
WN 2: Calculation of Share of Interest
Page No 6.104:
Question 59:
Revaluation Account | ||||||
Dr. | Cr. | |||||
Particulars | Amount Rs |
Particulars | Amount Rs |
|||
Provision for Doubtful Debts A/c | 1,800 | Furniture A/c | 3,750 | |||
Machinery A/c | 12,000 | Stock A/c | 3,200 | |||
Advertisement Expenses A/c | 2,100 | |||||
Loss transferred to: | ||||||
X’s Capital A/c
|
2,375 | |||||
Y’s Capital A/c
|
1,583 | |||||
Z’s Capital A/c
|
792 | 4,750 | ||||
13,800 | 13,800 | |||||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | X | Y | Z | Particulars | X | Y | Z | ||
Balance b/d (Current A/c) | 5,000 | Balance b/d (Capital A/c) | 1,50,000 | 1,00,000 | 50,000 | ||||
Revaluation A/c | 2,375 | 1,583 | 792 | Balance b/d (Current A/c) | 8,000 | 2,500 | |||
Z’s Capital A/c | 3,000 | 2,000 | Workmen Compensation Reserve A/c | 3,000 | 2,000 | 1,000 | |||
Z’s Executor A/c | 54,208 | X’s Capital A/c | 3,000 | ||||||
Balance c/d | 1,67,625 | 1,08,917 | Y’s Capital A/c | 2,000 | |||||
General Reserve A/c | 12,000 | 8,000 | 4,000 | ||||||
1,73,000 | 1,12,500 | 60,000 | 1,73,000 | 1,12,500 | 60,000 | ||||
Z’s Executor’s Account | |||||||
Dr. | Cr. | ||||||
Date | Particulars | Amount Rs |
Date | Particulars | Amount Rs |
||
2013 | 2013 | ||||||
Sep. 30 | Bank A/c | 29,272 | April 01 | Balance b/d | 54,208 | ||
2014 | Sep. 30 | Interest A/c (WN 2) | 2,168 | ||||
March 31 | Bank A/c | 28,188 | 2014 | ||||
March 31 | Interest A/c (WN 2) | 1,084 | |||||
57,460 | 57,460 | ||||||
Working Notes:
WN 1: Calculation of Share of Goodwill
WN 2: Calculation of Share of Interest
Answer:
Calculation of Amount Payable to Legal Representative of B | |
Particulars | Amount Rs |
Capital Balance | 37,500 |
Add: | |
Interest on Capital | 1,125 |
Profit and Loss Suspense | 27,500 |
Drawings | 40,000 |
General Reserve | 8,333 |
1,14,458 | |
Less: | |
Drawings | 25,000 |
Interest on Drawings A/c | 625 |
Total | 88,833 |
Working Notes:
WN 1: Calculation of Interest on Capital
Interest on Capital =
WN 2: Calculation of Profit
Total Profit = 1,62,500 + 1,60,000 + 1,72,500 = Rs 4,95,000
B’s Share =
WN 3: Calculation of Interest on Drawings
Interest on drawings =
Since, date of drawings has not been specified, thus, interest has been calculated for a average period of 3 months as drawings were given for the period of 6 months.
Page No 6.104:
Question 60:
Calculation of Amount Payable to Legal Representative of B | |
Particulars | Amount Rs |
Capital Balance | 37,500 |
Add: | |
Interest on Capital | 1,125 |
Profit and Loss Suspense | 27,500 |
Drawings | 40,000 |
General Reserve | 8,333 |
1,14,458 | |
Less: | |
Drawings | 25,000 |
Interest on Drawings A/c | 625 |
Total | 88,833 |
Working Notes:
WN 1: Calculation of Interest on Capital
Interest on Capital =
WN 2: Calculation of Profit
Total Profit = 1,62,500 + 1,60,000 + 1,72,500 = Rs 4,95,000
B’s Share =
WN 3: Calculation of Interest on Drawings
Interest on drawings =
Since, date of drawings has not been specified, thus, interest has been calculated for a average period of 3 months as drawings were given for the period of 6 months.
Answer:
Revaluation Account | |||||||
Dr. | Cr. | ||||||
Particulars | Amount Rs |
Particulars | Amount Rs |
||||
Stock A/c | 24,000 | Land and Building A/c | 75,000 | ||||
Provision for Doubtful Debts A/c | 15,000 | ||||||
Profit transferred to: | |||||||
P’s Capital A/c
|
12,000 | ||||||
Q’s Capital A/c
|
18,000 | ||||||
R’s Capital A/c
|
6,000 | 36,000 | |||||
75,000 | 75,000 | ||||||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | P | Q | R | Particulars | P | Q | R | ||
Q’s Capital A/c | 54,000 | Balance b/d | 3,00,000 | 6,00,000 | 9,00,000 | ||||
R’s Capital A/c | 90,000 | Policy A/c | 60,000 | 90,000 | 30,000 | ||||
Advertisement Suspense A/c | 12,000 | 18,000 | 6,000 | P’s Capital A/c | 54,000 | 90,000 | |||
Goodwill A/c | 12,000 | 18,000 | 6,000 | Workmen Compensation Reserve A/c | 12,000 | 18,000 | 6,000 | ||
Bank A/c | 5,11,500 | Investments Fluctuation Reserve A/c | 6,000 | 9,000 | 3,000 | ||||
R’s Executor A/c | 5,11,500 | Revaluation A/c | 12,000 | 18,000 | 6,000 | ||||
Balance c/d | 2,22,000 | 7,53,000 | |||||||
3,90,000 | 7,89,000 | 10,35,000 | 3,90,000 | 7,89,000 | 10,35,000 | ||||
Balance Sheet
as on April 01, 2016 after R’s death
|
|||||
Liabilities | Amount Rs |
Assets | Amount Rs |
||
Creditors | 7,20,000 | Land and Building | 8,25,000 | ||
Capital A/cs: | Investments | 1,38,000 | |||
P
|
2,22,000 | Stock | 2,16,000 | ||
Q
|
7,53,000 | 9,75,000 | Debtors | 9,00,000 | |
Employees Provident Fund | 3,60,000 |
Less: Provision for Doubtful Debts
|
45,000 | 8,55,000 | |
Workmen Compensation Reserve | 24,000 | Bank (8,88,000 – 5,11,500 + 1,80,000) | 5,56,500 | ||
R’s Executor A/c | 5,11,500 | ||||
25,90,500 | 25,90,500 | ||||
Working Notes:
WN 1: Calculation of Gaining Ratio
Gaining Ratio = New Ratio – Old Ratio
Old Ratio = 2 : 3 : 1
New Ratio = 3 : 2
WN 2: Calculation of Share of Goodwill
Total Profit = 1,35,000 + 2,70,000 + 4,05,000 = Rs 8,10,000
Goodwill = Average Profit × 1 Year of Purchase
Goodwill = 2,70,000 × 2 = Rs 5,40,000
Page No 6.105:
Question 61:
Revaluation Account | |||||||
Dr. | Cr. | ||||||
Particulars | Amount Rs |
Particulars | Amount Rs |
||||
Stock A/c | 24,000 | Land and Building A/c | 75,000 | ||||
Provision for Doubtful Debts A/c | 15,000 | ||||||
Profit transferred to: | |||||||
P’s Capital A/c
|
12,000 | ||||||
Q’s Capital A/c
|
18,000 | ||||||
R’s Capital A/c
|
6,000 | 36,000 | |||||
75,000 | 75,000 | ||||||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | P | Q | R | Particulars | P | Q | R | ||
Q’s Capital A/c | 54,000 | Balance b/d | 3,00,000 | 6,00,000 | 9,00,000 | ||||
R’s Capital A/c | 90,000 | Policy A/c | 60,000 | 90,000 | 30,000 | ||||
Advertisement Suspense A/c | 12,000 | 18,000 | 6,000 | P’s Capital A/c | 54,000 | 90,000 | |||
Goodwill A/c | 12,000 | 18,000 | 6,000 | Workmen Compensation Reserve A/c | 12,000 | 18,000 | 6,000 | ||
Bank A/c | 5,11,500 | Investments Fluctuation Reserve A/c | 6,000 | 9,000 | 3,000 | ||||
R’s Executor A/c | 5,11,500 | Revaluation A/c | 12,000 | 18,000 | 6,000 | ||||
Balance c/d | 2,22,000 | 7,53,000 | |||||||
3,90,000 | 7,89,000 | 10,35,000 | 3,90,000 | 7,89,000 | 10,35,000 | ||||
Balance Sheet
as on April 01, 2016 after R’s death
|
|||||
Liabilities | Amount Rs |
Assets | Amount Rs |
||
Creditors | 7,20,000 | Land and Building | 8,25,000 | ||
Capital A/cs: | Investments | 1,38,000 | |||
P
|
2,22,000 | Stock | 2,16,000 | ||
Q
|
7,53,000 | 9,75,000 | Debtors | 9,00,000 | |
Employees Provident Fund | 3,60,000 |
Less: Provision for Doubtful Debts
|
45,000 | 8,55,000 | |
Workmen Compensation Reserve | 24,000 | Bank (8,88,000 – 5,11,500 + 1,80,000) | 5,56,500 | ||
R’s Executor A/c | 5,11,500 | ||||
25,90,500 | 25,90,500 | ||||
Working Notes:
WN 1: Calculation of Gaining Ratio
Gaining Ratio = New Ratio – Old Ratio
Old Ratio = 2 : 3 : 1
New Ratio = 3 : 2
WN 2: Calculation of Share of Goodwill
Total Profit = 1,35,000 + 2,70,000 + 4,05,000 = Rs 8,10,000
Goodwill = Average Profit × 1 Year of Purchase
Goodwill = 2,70,000 × 2 = Rs 5,40,000
Answer:
Journal
|
||||
Particulars
|
L.F.
|
Debit
Amount
Rs
|
Credit
Amount
Rs
|
|
General Reserve A/c
|
Dr.
|
|
10,000
|
|
To A’s Capital A/c
|
|
|
|
6,000
|
To B’s Capital
|
|
|
|
2,000
|
To C’s Capital A/c
|
|
|
|
2,000
|
(General reserve distributed among partners in their old ratio)
|
|
|
|
|
|
|
|
|
|
Land A/c
|
Dr.
|
|
1,00,000
|
|
To Revaluation A/c
|
|
|
|
1,00,000
|
(Increase in value of Land transferred to Revaluation Account)
|
|
|
|
|
|
|
|
|
|
Revaluation A/c
|
Dr.
|
|
68,000
|
|
To Plant and Machinery A/c
|
|
|
|
68,000
|
(Decrease in value of Plant and Machinery transferred to Revaluation Account)
|
|
|
|
|
|
|
|
|
|
Revaluation A/c
|
Dr.
|
|
32,000
|
|
To A’s Capital A/c
|
|
|
|
19,200
|
To B’s Capital A/c
|
|
|
|
6,400
|
To C’s Capital A/c
|
|
|
|
6,400
|
(Revaluation profit distributed among partners in their old ratio)
|
|
|
|
|
|
|
|
|
|
A’s Capital A/c
|
Dr.
|
|
36,000
|
|
C’s Capital A/c
|
Dr.
|
|
12,000
|
|
To B’s Capital A/c
|
|
|
|
48,000
|
(B’s share of goodwill adjusted)
|
|
|
|
|
|
|
|
|
|
B’s Capital A/c
|
Dr.
|
|
10,000
|
|
To B’s Drawings A/c
|
|
|
|
10,000
|
(B’s drawing charged from his capital account)
|
|
|
|
|
|
|
|
|
|
Profit and Loss Suspense A/c
|
Dr.
|
|
4,000
|
|
To B’s Capital A/c
|
|
|
|
4,000
|
(B’s share of profit transferred to his capital account)
|
|
|
|
|
|
|
|
|
|
B’s Capital A/c
|
Dr.
|
|
4,63,200
|
|
To B’s Executor’s A/c
|
|
|
|
4,63,200
|
(Amount due to B after all adjustments transferred to his Executor’s Account)
|
|
|
|
|
|
|
|
|
|
WN 1 Calculation of Goodwill
Goodwill = Average Profit × Number of Year’s Purchase
∴ Goodwill = Average Profit × Number of Years’ Purchase
= 1,20,000 × 2 = Rs 2,40,000
WN 2 Adjustment of Goodwill
Old Ratio (A, B and C) = 3 : 1 : 1
B died.
∴ New Ratio (A and C) = 3 : 1 and
Gaining Ratio = 3 : 1
B’s Share in Goodwill =
This share of goodwill is to be distributed between A and C in their gaining ratio (i.e. 3 : 1).
WN 3 Calculation of B’s Share of Profit
WN 4
Revaluation Account |
||||
Dr. |
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Plan and Machinery |
68,000 |
Land |
1,00,000 |
|
Profit transferred to: |
|
|
|
|
A’s Capital A/c |
19,200 |
|
|
|
B’s Capital A/c |
6,400 |
|
|
|
C’s Capital A/c |
6,400 |
32,000 |
|
|
|
1,00,000 |
|
1,00,000 |
|
|
|
|
|
WN 5
B’s Capital Account
|
|||
Dr.
|
|
Cr.
|
|
Particulars
|
Amount
Rs
|
Particulars
|
Amount
Rs
|
Drawings A/c
|
10,000
|
Balance b/d
|
4,12,800
|
B’s Executor’s A/c
|
4,63,200
|
General Reserve
|
2,000
|
|
|
Profit and Loss Suspense A/c
|
4,000
|
|
|
A’s Capital A/c
|
36,000
|
|
|
C’s Capital A/c
|
12,000
|
|
|
Revaluation A/c (Profit)
|
6,400
|
|
|
|
|
|
4,73,200
|
|
4,73,200
|
|
|
|
|
Page No 6.106:
Question 62:
Journal
|
||||
Particulars
|
L.F.
|
Debit
Amount
Rs
|
Credit
Amount
Rs
|
|
General Reserve A/c
|
Dr.
|
|
10,000
|
|
To A’s Capital A/c
|
|
|
|
6,000
|
To B’s Capital
|
|
|
|
2,000
|
To C’s Capital A/c
|
|
|
|
2,000
|
(General reserve distributed among partners in their old ratio)
|
|
|
|
|
|
|
|
|
|
Land A/c
|
Dr.
|
|
1,00,000
|
|
To Revaluation A/c
|
|
|
|
1,00,000
|
(Increase in value of Land transferred to Revaluation Account)
|
|
|
|
|
|
|
|
|
|
Revaluation A/c
|
Dr.
|
|
68,000
|
|
To Plant and Machinery A/c
|
|
|
|
68,000
|
(Decrease in value of Plant and Machinery transferred to Revaluation Account)
|
|
|
|
|
|
|
|
|
|
Revaluation A/c
|
Dr.
|
|
32,000
|
|
To A’s Capital A/c
|
|
|
|
19,200
|
To B’s Capital A/c
|
|
|
|
6,400
|
To C’s Capital A/c
|
|
|
|
6,400
|
(Revaluation profit distributed among partners in their old ratio)
|
|
|
|
|
|
|
|
|
|
A’s Capital A/c
|
Dr.
|
|
36,000
|
|
C’s Capital A/c
|
Dr.
|
|
12,000
|
|
To B’s Capital A/c
|
|
|
|
48,000
|
(B’s share of goodwill adjusted)
|
|
|
|
|
|
|
|
|
|
B’s Capital A/c
|
Dr.
|
|
10,000
|
|
To B’s Drawings A/c
|
|
|
|
10,000
|
(B’s drawing charged from his capital account)
|
|
|
|
|
|
|
|
|
|
Profit and Loss Suspense A/c
|
Dr.
|
|
4,000
|
|
To B’s Capital A/c
|
|
|
|
4,000
|
(B’s share of profit transferred to his capital account)
|
|
|
|
|
|
|
|
|
|
B’s Capital A/c
|
Dr.
|
|
4,63,200
|
|
To B’s Executor’s A/c
|
|
|
|
4,63,200
|
(Amount due to B after all adjustments transferred to his Executor’s Account)
|
|
|
|
|
|
|
|
|
|
WN 1 Calculation of Goodwill
Goodwill = Average Profit × Number of Year’s Purchase
∴ Goodwill = Average Profit × Number of Years’ Purchase
= 1,20,000 × 2 = Rs 2,40,000
WN 2 Adjustment of Goodwill
Old Ratio (A, B and C) = 3 : 1 : 1
B died.
∴ New Ratio (A and C) = 3 : 1 and
Gaining Ratio = 3 : 1
B’s Share in Goodwill =
This share of goodwill is to be distributed between A and C in their gaining ratio (i.e. 3 : 1).
WN 3 Calculation of B’s Share of Profit
WN 4
Revaluation Account |
||||
Dr. |
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Plan and Machinery |
68,000 |
Land |
1,00,000 |
|
Profit transferred to: |
|
|
|
|
A’s Capital A/c |
19,200 |
|
|
|
B’s Capital A/c |
6,400 |
|
|
|
C’s Capital A/c |
6,400 |
32,000 |
|
|
|
1,00,000 |
|
1,00,000 |
|
|
|
|
|
WN 5
B’s Capital Account
|
|||
Dr.
|
|
Cr.
|
|
Particulars
|
Amount
Rs
|
Particulars
|
Amount
Rs
|
Drawings A/c
|
10,000
|
Balance b/d
|
4,12,800
|
B’s Executor’s A/c
|
4,63,200
|
General Reserve
|
2,000
|
|
|
Profit and Loss Suspense A/c
|
4,000
|
|
|
A’s Capital A/c
|
36,000
|
|
|
C’s Capital A/c
|
12,000
|
|
|
Revaluation A/c (Profit)
|
6,400
|
|
|
|
|
|
4,73,200
|
|
4,73,200
|
|
|
|
|
Answer:
X’s Capital Account | |||||
Dr. | Cr. | ||||
Particulars | Amount Rs | Particulars | Amount Rs | ||
Goodwill A/c | 18,900 | Balance b/d | 90,000 | ||
X’s Executor’s A/c | 1,01,850 | Y’s Capital A/c | 5,250 | ||
Z’s Capital A/c | 5,250 | ||||
Profit and Loss Suspense A/c | 2,250 | ||||
Revaluation A/c (Profit) | 18,000 | ||||
1,20,750 | 1,20,750 | ||||
Working Notes:
WN 1: Calculation of X’s Profit Share
Total Profit = 30,000 + 24,000 + 27,000 = Rs 81,000
X’s Share =
WN 2: Calculation of Share of Goodwill
Total Profit= 30,000 + 24,000 + 27,000 + 42,000 + 34,500 = Rs 1,57,500
Goodwill = Average Profit × 1 Year of Purchase
Goodwill = 31,500 × 1 = Rs 31,500
X’s Share =
WN 3: Calculation of Revaluation Profit
Increase in Value of Freehold Property = Rs 54,000
X’s Share =
Page No 6.106:
Question 63:
X’s Capital Account | |||||
Dr. | Cr. | ||||
Particulars | Amount Rs | Particulars | Amount Rs | ||
Goodwill A/c | 18,900 | Balance b/d | 90,000 | ||
X’s Executor’s A/c | 1,01,850 | Y’s Capital A/c | 5,250 | ||
Z’s Capital A/c | 5,250 | ||||
Profit and Loss Suspense A/c | 2,250 | ||||
Revaluation A/c (Profit) | 18,000 | ||||
1,20,750 | 1,20,750 | ||||
Working Notes:
WN 1: Calculation of X’s Profit Share
Total Profit = 30,000 + 24,000 + 27,000 = Rs 81,000
X’s Share =
WN 2: Calculation of Share of Goodwill
Total Profit= 30,000 + 24,000 + 27,000 + 42,000 + 34,500 = Rs 1,57,500
Goodwill = Average Profit × 1 Year of Purchase
Goodwill = 31,500 × 1 = Rs 31,500
X’s Share =
WN 3: Calculation of Revaluation Profit
Increase in Value of Freehold Property = Rs 54,000
X’s Share =
Answer:
Revaluation Account |
||||||
Dr. |
|
Cr. |
||||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|||
Fixed Assets |
2,500 |
Creditors |
2,000 |
|||
Provision for Doubtful Debts |
5,000 |
Loss on Revaluation transferred to |
|
|||
|
|
X’s Capital A/c |
2,750 |
|
||
|
|
Y’s Capital A/c |
1,650 |
|
||
|
|
Z’s Capital A/c |
1,100 |
5,500 |
||
|
7,500 |
|
7,500 |
|||
|
|
|
|
|||
Partners’ Capital Accounts |
||||||||
Dr. |
|
Cr. |
||||||
Particulars |
X |
Y |
Z |
Particulars |
X |
Y |
Z |
|
Revaluation A/c |
2,750 |
1,650 |
1,100 |
Balance b/d |
40,000 |
62,000 |
33,000 |
|
Goodwill A/c |
2,500 |
1,500 |
1,000 |
Y’s Capital A/c |
8,000 |
|
|
|
Advertisement Suspense A/c |
2,500 |
1,500 |
1,000 |
Z’s Capital A/c |
32,000 |
|
|
|
X’s Capital A/c |
|
8,000 |
32,000 |
Profit and Loss A/c |
42,500 |
25,500 |
17,000 |
|
Bank A/c |
1,19,750 |
|
|
Workmen Compensation Reserve |
5,000 |
3,000 |
2,000 |
|
Balance c/d (WN2) |
|
79,000 |
1,18,500 |
Bank A/c (Bal. Fig.) |
|
1,150 |
1,01,600 |
|
|
1,27,500 |
91,650 |
1,53,600 |
|
1,27,500 |
91,650 |
1,53,600 |
|
|
|
|
|
|
|
|
|
|
Working Notes:
WN 1: Calculation of sacrificing/gaining ratio
WN 2: Calculation of New Capital of Y and Z
Page No 6.107:
Question 64:
Revaluation Account |
||||||
Dr. |
|
Cr. |
||||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|||
Fixed Assets |
2,500 |
Creditors |
2,000 |
|||
Provision for Doubtful Debts |
5,000 |
Loss on Revaluation transferred to |
|
|||
|
|
X’s Capital A/c |
2,750 |
|
||
|
|
Y’s Capital A/c |
1,650 |
|
||
|
|
Z’s Capital A/c |
1,100 |
5,500 |
||
|
7,500 |
|
7,500 |
|||
|
|
|
|
|||
Partners’ Capital Accounts |
||||||||
Dr. |
|
Cr. |
||||||
Particulars |
X |
Y |
Z |
Particulars |
X |
Y |
Z |
|
Revaluation A/c |
2,750 |
1,650 |
1,100 |
Balance b/d |
40,000 |
62,000 |
33,000 |
|
Goodwill A/c |
2,500 |
1,500 |
1,000 |
Y’s Capital A/c |
8,000 |
|
|
|
Advertisement Suspense A/c |
2,500 |
1,500 |
1,000 |
Z’s Capital A/c |
32,000 |
|
|
|
X’s Capital A/c |
|
8,000 |
32,000 |
Profit and Loss A/c |
42,500 |
25,500 |
17,000 |
|
Bank A/c |
1,19,750 |
|
|
Workmen Compensation Reserve |
5,000 |
3,000 |
2,000 |
|
Balance c/d (WN2) |
|
79,000 |
1,18,500 |
Bank A/c (Bal. Fig.) |
|
1,150 |
1,01,600 |
|
|
1,27,500 |
91,650 |
1,53,600 |
|
1,27,500 |
91,650 |
1,53,600 |
|
|
|
|
|
|
|
|
|
|
Working Notes:
WN 1: Calculation of sacrificing/gaining ratio
WN 2: Calculation of New Capital of Y and Z
Answer:
Journal |
|||||
Date |
Particulars |
L.F. |
Debit Amount (Rs) |
Credit Amount (Rs) |
|
2014 |
|
|
|
|
|
August 01 |
Patents A/c |
Dr. |
|
85,000 |
|
|
Investments A/c |
Dr. |
|
6,000 |
|
|
To Revaluation A/c |
|
|
|
91,000 |
|
(Patens recorded at a lesser value and investments sold at a profit of Rs 6,000) |
|
|
|
|
|
|
|
|
|
|
|
Revaluation A/c |
Dr. |
|
16,000 |
|
|
To Machinery A/c |
|
|
|
16,000 |
|
(Machinery is recorded with excess value of Rs 16,000 in the books) |
|
|
|
|
|
|
|
|
|
|
|
Revaluation A/c |
Dr. |
|
75,000 |
|
|
To X’s Capital A/c |
|
|
37,500 |
|
|
To Y’s Capital A/c |
|
|
|
22,500 |
|
To Z’s Capital A/c |
|
|
|
15,000 |
|
(Profit on revaluation transferred to Partners’ Capital Account in old ratio) |
|
|
|
|
|
|
|
|
|
|
|
X’s Capital A/c |
Dr. |
|
21,875 |
|
|
Y’s Capital A/c |
|
|
13,125 |
|
|
To Z’ s Capital A/c |
|
|
|
35,000 |
|
(Z’s share of goodwill compensated by X and Y in gaining ratio) |
|
|
|
|
|
|
|
|
|
|
|
Z’s Capital A/c |
Dr. |
|
5,000 |
|
|
To Profit and Loss Suspense A/c |
|
|
|
5,000 |
|
(Z’s share in loss till his death) |
|
|
|
|
|
|
|
|
|
|
|
Workmen Compensation Reserve |
Dr. |
|
17,500 |
|
|
To Workmen Compensation Claim |
|
|
|
10,000 |
|
To X’s Capital A/c |
|
|
|
3,750 |
|
To Y’s Capital A/c |
|
|
|
2,250 |
|
To Z’s Capital A/c |
|
|
|
1,500 |
|
(Amount transferred for workmen compensation claim and excess amount is distributed among the partners in old ratio) |
|
|
|
|
|
|
|
|
|
|
|
Investments Fluctuation Reserve |
Dr. |
|
17,500 |
|
|
To X’s Capital A/c |
|
|
|
8,750 |
|
To Y’s Capital A/c |
|
|
|
5,250 |
|
To Z’s Capital A/c |
|
|
|
3,500 |
|
(Entire balance of IFF is distributed among the partners in old ratio) |
|
|
|
|
|
|
|
|
|
|
|
X’s Capital A/c |
Dr. |
|
2,500 |
|
|
Y’s Capital A/c |
Dr. |
|
1,500 |
|
|
Z’s Capital A/c |
Dr. |
|
1,000 |
|
|
To Advertisement Expenditure A/c |
|
|
|
5,000 |
|
(Advertisement expenditure debited to partners’ capital accounts in old ratio) |
|
|
|
|
|
|
|
|
|
|
|
X’s Capital A/c |
Dr. |
|
1,87,500 |
|
|
Y’s Capital A/c |
Dr. |
|
1,12,500 |
|
|
Z’s Capital A/c |
Dr. |
|
75,000 |
|
|
To Profit and Loss A/c |
|
|
|
3,75,000 |
|
(Loss during 2013-14 debited to partners’ capital accounts in old ratio) |
|
|
|
|
|
|
|
|
|
|
|
Z’s Capital A/c |
Dr. |
|
1,24,000 |
|
|
To Z’s Executor A/c |
|
|
1,24,000 |
|
|
(Z’s capital balance is transferred to Z’s Executor Account) |
|
|
|
|
|
|
|
|
|
|
|
Z’s Executor A/c |
Dr. |
|
24,000 |
|
|
To Bank A/c |
|
|
24,000 |
|
|
(Payment made to Z’s executor) |
|
|
|
|
|
|
|
|
|
Partners’ Capital Accounts |
||||||||
Dr. |
|
Cr. |
||||||
Particulars |
X |
Y |
Z |
Particulars |
X |
Y |
Z |
|
Profit and Loss A/c |
1,87,500 |
1,12,500 |
75,000 |
Balance b/d |
3,37,500 |
2,37,500 |
1,85,000 |
|
Z’s Capital A/c |
21,875 |
13,125 |
|
Revaluation A/c |
37,500 |
22,500 |
15,000 |
|
Profit and Loss Suspense A/c |
|
|
5,000 |
X’s Capital A/c |
|
|
21,875 |
|
Advertisement Suspense A/c |
2,500 |
1,500 |
1,000 |
Y’s Capital A/c |
|
|
13,125 |
|
Drawings A/c |
|
|
25,000 |
Workmen Compensation Reserve |
3,750 |
2,250 |
1,500 |
|
Goodwill A/c |
12,500 |
7,500 |
5,000 |
Investments Fluctuation Reserve |
8,750 |
5,250 |
3,500 |
|
Loan to Z |
|
|
5,000 |
|
|
|
|
|
Z’s Executor A/c |
|
|
1,24,000 |
|
|
|
|
|
Balance c/d |
1,63,125 |
1,32,875 |
|
|
|
|
|
|
|
3,87,500 |
2,67,500 |
2,40,000 |
|
3,87,500 |
2,67,500 |
2,40,000 |
|
|
|
|
|
|
|
|
|
Balance Sheet as at August 01, 2014 |
||||||
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|||
Capital A/cs: |
|
|
|
|||
X |
1,63,125 |
|
Patents |
1,30,000 |
|
|
Y |
1,32,875 |
2,96,000 |
Add: Undervaluation |
85,000 |
2,15,000 |
|
Sundry Creditors |
55,000 |
Machinery |
1,56,000 |
|
||
Z’s Executor Loan A/c |
1,00,000 |
Less: Overvaluation |
16,000 |
1,40,000 |
||
Workmen Compensation Claim |
10,000 |
Stock |
50,000 |
|||
Profit and Loss Suspense |
5,000 |
Sundry Debtors |
62,000 |
|
||
|
|
|
Less: Provision for DD |
2,000 |
60,000 |
|
|
|
|
Cash at Bank (29,000 + 21,000 – 24,000 – 25,000) |
1,000 |
||
|
|
|
|
|
||
|
4,66,000 |
|
4,66,000 |
|||
|
|
|
|
Z’s Executor’s Account |
|||||
Dr. |
|
Cr. |
|||
Date |
Particulars |
Amount Rs |
Date |
Particulars |
Amount Rs |
2014 |
|
|
2014 |
|
|
Aug. 01 |
Bank A/c |
24,000 |
Aug. 01 |
T’s Capital A/c |
1,24,000 |
2015 |
|
|
2015 |
|
|
Feb. 01 |
Cash A/c (25,000 + 5,000) |
30,000 |
Feb. 01 |
Interest (1,00,000 ×10% for 6 months) |
5,000 |
March 31 |
Balance c/d |
76,250 |
March 31 |
Interest (75,000 ×10% for 2 months) |
1,250 |
|
|
1,27,250 |
|
|
1,27,250 |
2015 |
|
|
2015 |
|
|
August 01 |
Cash A/c (25,000 + 1,250 + 2,500) |
28,750 |
April 01 |
Balance b/d |
76,250 |
2016 |
|
|
August 01 |
Interest (75,000 × 10% for 4 months) |
2,500 |
Feb. 01 |
Cash A/c (25,000 + 2,500) |
27,500 |
2016 |
|
|
March 31 |
Balance c/d |
25,417 |
Feb. 01 |
Interest (50,000 × 10% for 6 months) |
2,500 |
|
|
|
March 31 |
Interest (25,000 × 10% for 2 months) |
417 |
|
|
81,667 |
|
|
81,667 |
2016 |
|
|
2016 |
|
|
August 01 |
Cash A/c (25,000 + 417 + 833) |
26,250 |
April 01 |
Balance b/d |
25,417 |
|
|
|
August 01 |
Interest (25,000 × 10% for 4 months) |
833 |
|
|
26,250 |
|
|
26,250 |
|
|
|
|
|
|
Working Notes:
WN 1: Calculation of Goodwill
WN 2: Calculation of Z’s Profit Share
Page No 6.84:
Question 1:
Journal |
|||||
Date |
Particulars |
L.F. |
Debit Amount (Rs) |
Credit Amount (Rs) |
|
2014 |
|
|
|
|
|
August 01 |
Patents A/c |
Dr. |
|
85,000 |
|
|
Investments A/c |
Dr. |
|
6,000 |
|
|
To Revaluation A/c |
|
|
|
91,000 |
|
(Patens recorded at a lesser value and investments sold at a profit of Rs 6,000) |
|
|
|
|
|
|
|
|
|
|
|
Revaluation A/c |
Dr. |
|
16,000 |
|
|
To Machinery A/c |
|
|
|
16,000 |
|
(Machinery is recorded with excess value of Rs 16,000 in the books) |
|
|
|
|
|
|
|
|
|
|
|
Revaluation A/c |
Dr. |
|
75,000 |
|
|
To X’s Capital A/c |
|
|
37,500 |
|
|
To Y’s Capital A/c |
|
|
|
22,500 |
|
To Z’s Capital A/c |
|
|
|
15,000 |
|
(Profit on revaluation transferred to Partners’ Capital Account in old ratio) |
|
|
|
|
|
|
|
|
|
|
|
X’s Capital A/c |
Dr. |
|
21,875 |
|
|
Y’s Capital A/c |
|
|
13,125 |
|
|
To Z’ s Capital A/c |
|
|
|
35,000 |
|
(Z’s share of goodwill compensated by X and Y in gaining ratio) |
|
|
|
|
|
|
|
|
|
|
|
Z’s Capital A/c |
Dr. |
|
5,000 |
|
|
To Profit and Loss Suspense A/c |
|
|
|
5,000 |
|
(Z’s share in loss till his death) |
|
|
|
|
|
|
|
|
|
|
|
Workmen Compensation Reserve |
Dr. |
|
17,500 |
|
|
To Workmen Compensation Claim |
|
|
|
10,000 |
|
To X’s Capital A/c |
|
|
|
3,750 |
|
To Y’s Capital A/c |
|
|
|
2,250 |
|
To Z’s Capital A/c |
|
|
|
1,500 |
|
(Amount transferred for workmen compensation claim and excess amount is distributed among the partners in old ratio) |
|
|
|
|
|
|
|
|
|
|
|
Investments Fluctuation Reserve |
Dr. |
|
17,500 |
|
|
To X’s Capital A/c |
|
|
|
8,750 |
|
To Y’s Capital A/c |
|
|
|
5,250 |
|
To Z’s Capital A/c |
|
|
|
3,500 |
|
(Entire balance of IFF is distributed among the partners in old ratio) |
|
|
|
|
|
|
|
|
|
|
|
X’s Capital A/c |
Dr. |
|
2,500 |
|
|
Y’s Capital A/c |
Dr. |
|
1,500 |
|
|
Z’s Capital A/c |
Dr. |
|
1,000 |
|
|
To Advertisement Expenditure A/c |
|
|
|
5,000 |
|
(Advertisement expenditure debited to partners’ capital accounts in old ratio) |
|
|
|
|
|
|
|
|
|
|
|
X’s Capital A/c |
Dr. |
|
1,87,500 |
|
|
Y’s Capital A/c |
Dr. |
|
1,12,500 |
|
|
Z’s Capital A/c |
Dr. |
|
75,000 |
|
|
To Profit and Loss A/c |
|
|
|
3,75,000 |
|
(Loss during 2013-14 debited to partners’ capital accounts in old ratio) |
|
|
|
|
|
|
|
|
|
|
|
Z’s Capital A/c |
Dr. |
|
1,24,000 |
|
|
To Z’s Executor A/c |
|
|
1,24,000 |
|
|
(Z’s capital balance is transferred to Z’s Executor Account) |
|
|
|
|
|
|
|
|
|
|
|
Z’s Executor A/c |
Dr. |
|
24,000 |
|
|
To Bank A/c |
|
|
24,000 |
|
|
(Payment made to Z’s executor) |
|
|
|
|
|
|
|
|
|
Partners’ Capital Accounts |
||||||||
Dr. |
|
Cr. |
||||||
Particulars |
X |
Y |
Z |
Particulars |
X |
Y |
Z |
|
Profit and Loss A/c |
1,87,500 |
1,12,500 |
75,000 |
Balance b/d |
3,37,500 |
2,37,500 |
1,85,000 |
|
Z’s Capital A/c |
21,875 |
13,125 |
|
Revaluation A/c |
37,500 |
22,500 |
15,000 |
|
Profit and Loss Suspense A/c |
|
|
5,000 |
X’s Capital A/c |
|
|
21,875 |
|
Advertisement Suspense A/c |
2,500 |
1,500 |
1,000 |
Y’s Capital A/c |
|
|
13,125 |
|
Drawings A/c |
|
|
25,000 |
Workmen Compensation Reserve |
3,750 |
2,250 |
1,500 |
|
Goodwill A/c |
12,500 |
7,500 |
5,000 |
Investments Fluctuation Reserve |
8,750 |
5,250 |
3,500 |
|
Loan to Z |
|
|
5,000 |
|
|
|
|
|
Z’s Executor A/c |
|
|
1,24,000 |
|
|
|
|
|
Balance c/d |
1,63,125 |
1,32,875 |
|
|
|
|
|
|
|
3,87,500 |
2,67,500 |
2,40,000 |
|
3,87,500 |
2,67,500 |
2,40,000 |
|
|
|
|
|
|
|
|
|
Balance Sheet as at August 01, 2014 |
||||||
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|||
Capital A/cs: |
|
|
|
|||
X |
1,63,125 |
|
Patents |
1,30,000 |
|
|
Y |
1,32,875 |
2,96,000 |
Add: Undervaluation |
85,000 |
2,15,000 |
|
Sundry Creditors |
55,000 |
Machinery |
1,56,000 |
|
||
Z’s Executor Loan A/c |
1,00,000 |
Less: Overvaluation |
16,000 |
1,40,000 |
||
Workmen Compensation Claim |
10,000 |
Stock |
50,000 |
|||
Profit and Loss Suspense |
5,000 |
Sundry Debtors |
62,000 |
|
||
|
|
|
Less: Provision for DD |
2,000 |
60,000 |
|
|
|
|
Cash at Bank (29,000 + 21,000 – 24,000 – 25,000) |
1,000 |
||
|
|
|
|
|
||
|
4,66,000 |
|
4,66,000 |
|||
|
|
|
|
Z’s Executor’s Account |
|||||
Dr. |
|
Cr. |
|||
Date |
Particulars |
Amount Rs |
Date |
Particulars |
Amount Rs |
2014 |
|
|
2014 |
|
|
Aug. 01 |
Bank A/c |
24,000 |
Aug. 01 |
T’s Capital A/c |
1,24,000 |
2015 |
|
|
2015 |
|
|
Feb. 01 |
Cash A/c (25,000 + 5,000) |
30,000 |
Feb. 01 |
Interest (1,00,000 ×10% for 6 months) |
5,000 |
March 31 |
Balance c/d |
76,250 |
March 31 |
Interest (75,000 ×10% for 2 months) |
1,250 |
|
|
1,27,250 |
|
|
1,27,250 |
2015 |
|
|
2015 |
|
|
August 01 |
Cash A/c (25,000 + 1,250 + 2,500) |
28,750 |
April 01 |
Balance b/d |
76,250 |
2016 |
|
|
August 01 |
Interest (75,000 × 10% for 4 months) |
2,500 |
Feb. 01 |
Cash A/c (25,000 + 2,500) |
27,500 |
2016 |
|
|
March 31 |
Balance c/d |
25,417 |
Feb. 01 |
Interest (50,000 × 10% for 6 months) |
2,500 |
|
|
|
March 31 |
Interest (25,000 × 10% for 2 months) |
417 |
|
|
81,667 |
|
|
81,667 |
2016 |
|
|
2016 |
|
|
August 01 |
Cash A/c (25,000 + 417 + 833) |
26,250 |
April 01 |
Balance b/d |
25,417 |
|
|
|
August 01 |
Interest (25,000 × 10% for 4 months) |
833 |
|
|
26,250 |
|
|
26,250 |
|
|
|
|
|
|
Working Notes:
WN 1: Calculation of Goodwill
WN 2: Calculation of Z’s Profit Share
Answer:
Note: Since no information about new ratio is given, it is assumed that partner’s will gain in their old ratio.
Page No 6.84:
Question 2:
Note: Since no information about new ratio is given, it is assumed that partner’s will gain in their old ratio.
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 6.84:
Question 3:
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
Answer:
Page No 6.84:
Question 4:
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 6.84:
Question 5:
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
Answer:
Page No 6.84:
Question 6:
Answer:
Page No 6.84:
Question 7:
Answer:
Page No 6.84:
Question 8:
Answer:
Page No 6.84:
Question 9:
Answer:
Page No 6.85:
Question 10:
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 6.85:
Question 11:
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).
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
WN 2: Calculation of Goodwill
Total amount of Goodwill
Page No 6.85:
Question 12:
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
WN 2: Calculation of Goodwill
Total amount of Goodwill
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
Page No 6.85:
Question 13:
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
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
Page No 6.85:
Question 14:
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
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 6.85:
Question 15:
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) |
|
|
|
|
|
|
|
|
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 | |
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
Page No 6.86:
Question 16:
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 | |
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
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 6.86:
Question 17:
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.
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, 2015
|
|||||
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
Page No 6.86:
Question 18:
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, 2015
|
|||||
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
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, 2015 (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 6.87:
Question 19:
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, 2015 (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 |
|
|
|
|
|
|
|
|
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, 2015
|
|||||
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
Page No 6.87:
Question 20:
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, 2015
|
|||||
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
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 6.88:
Question 21:
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 | ||||
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 6.88:
Question 22:
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 | |||||
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 | 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) | |
2005 | 2005 | |||||
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 | |||||
2006 | 2006 | |||||
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 | |||||
2007 | 2007 | |||||
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 | |||||
2008 | 2008 | |||||
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 | |||||
2009 | 2009 | |||||
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 | |||||
2010 | 2010 | |||||
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 6.88:
Question 23:
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 | 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) | |
2005 | 2005 | |||||
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 | |||||
2006 | 2006 | |||||
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 | |||||
2007 | 2007 | |||||
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 | |||||
2008 | 2008 | |||||
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 | |||||
2009 | 2009 | |||||
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 | |||||
2010 | 2010 | |||||
Dec. 31 | Bank A/c | 2,741 | Jan. 01 | Balance b/d | 2,586 | |
Dec. 31 | Interest A/c | 155 | ||||
2,741 | 2,741 | |||||
Answer:
Journal |
|||||
Date |
Particulars |
L.F. |
Debit Amount (Rs) |
Credit Amount (Rs) |
|
2015 |
|
|
|
|
|
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, 2015 |
|||||
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 6.89:
Question 24:
Journal |
|||||
Date |
Particulars |
L.F. |
Debit Amount (Rs) |
Credit Amount (Rs) |
|
2015 |
|
|
|
|
|
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, 2015 |
|||||
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
Answer:
Revaluation Account | ||||
Particulars | Amount (Rs) | Particulars | Amount (Rs) | |
Investment A/c (WN1) | 1,000 | Building A/c | 10,000 | |
Stock A/c | 280 | Provision for Doubtful Debts A/c | 1,600 | |
Profit transferred to: | ||||
P’s Capital A/c
|
3,440 | |||
Q’s Capital A/c
|
3,440 | |||
R’s Capital A/c
|
3,440 | 10,320 | ||
11,600 | 11,600 | |||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | P | Q | R | Particulars | P | Q | R | ||
R’s Capital A/c | 2,000 | − | − | Balance b/d | 51,000 | 40,000 | 40,000 | ||
Goodwill A/c | 1,000 | 1,000 | 1,000 | P’s Capital A/c | − | − | 2,000 | ||
Bank A/c | − | − | 23,440 | Revaluation A/c | 3,440 | 3,440 | 3,440 | ||
R’s Loan A/c | − | − | 28,000 | Profit & Loss A/c | 1,000 | 1,000 | 1,000 | ||
Balance c/d | 58,440 | 49,440 | − | Workmen Compensation Reserve A/c | 6,000 | 6,000 | 6,000 | ||
61,440 | 50,440 | 52,440 | 61,440 | 50,440 | 52,440 | ||||
Bank Account | |||
Particulars | Amount (Rs) | Amount (Rs) | |
Balance b/d | 1,60,000 | R’s Capital A/c | 23,440 |
Balance c/d | 1,36,560 | ||
1,60,000 | 1,60,000 | ||
Balance Sheet
as on ….
|
||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | |
Capital A/cs: | Building (1,00,000 + 10,000) | 1,10,000 | ||
P
|
58,440 | Debtors | 30,000 | |
Q
|
49,440 | 1,07,880 | Investments (30,000 – 3,000) | 27,000 |
R’s Loan A/c | 28,000 | Stock (4,000 – 280) | 3,720 | |
Creditors | 2,00,400 | Bank | 1,36,560 | |
Machinery | 29,000 | |||
3,36,280 | 3,36,280 | |||
R’s Loan Account | |||
Particulars | Amount (Rs) | Amount (Rs) | |
Bank A/c (14,000+ 2,240) | 16,240 | R’s Capital A/c | 28,000 |
Balance c/d | 14,000 | Interest A/c (28,000 × 8%) | 2,240 |
30,240 | 30,240 | ||
Bank A/c (14,000+ 1,120) | 15,120 | Balance b/d | 14,000 |
Interest A/c (14,000 × 8%) | 1,120 | ||
15,120 | 15,120 | ||
Working Notes:
WN 1: Calculation of Value of Investments
WN 2: Calculation of Valuation of Goodwill
WN 3: Calculation of Gaining Ratio
Page No 6.89:
Question 25:
Revaluation Account | ||||
Particulars | Amount (Rs) | Particulars | Amount (Rs) | |
Investment A/c (WN1) | 1,000 | Building A/c | 10,000 | |
Stock A/c | 280 | Provision for Doubtful Debts A/c | 1,600 | |
Profit transferred to: | ||||
P’s Capital A/c
|
3,440 | |||
Q’s Capital A/c
|
3,440 | |||
R’s Capital A/c
|
3,440 | 10,320 | ||
11,600 | 11,600 | |||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | P | Q | R | Particulars | P | Q | R | ||
R’s Capital A/c | 2,000 | − | − | Balance b/d | 51,000 | 40,000 | 40,000 | ||
Goodwill A/c | 1,000 | 1,000 | 1,000 | P’s Capital A/c | − | − | 2,000 | ||
Bank A/c | − | − | 23,440 | Revaluation A/c | 3,440 | 3,440 | 3,440 | ||
R’s Loan A/c | − | − | 28,000 | Profit & Loss A/c | 1,000 | 1,000 | 1,000 | ||
Balance c/d | 58,440 | 49,440 | − | Workmen Compensation Reserve A/c | 6,000 | 6,000 | 6,000 | ||
61,440 | 50,440 | 52,440 | 61,440 | 50,440 | 52,440 | ||||
Bank Account | |||
Particulars | Amount (Rs) | Amount (Rs) | |
Balance b/d | 1,60,000 | R’s Capital A/c | 23,440 |
Balance c/d | 1,36,560 | ||
1,60,000 | 1,60,000 | ||
Balance Sheet
as on ….
|
||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | |
Capital A/cs: | Building (1,00,000 + 10,000) | 1,10,000 | ||
P
|
58,440 | Debtors | 30,000 | |
Q
|
49,440 | 1,07,880 | Investments (30,000 – 3,000) | 27,000 |
R’s Loan A/c | 28,000 | Stock (4,000 – 280) | 3,720 | |
Creditors | 2,00,400 | Bank | 1,36,560 | |
Machinery | 29,000 | |||
3,36,280 | 3,36,280 | |||
R’s Loan Account | |||
Particulars | Amount (Rs) | Amount (Rs) | |
Bank A/c (14,000+ 2,240) | 16,240 | R’s Capital A/c | 28,000 |
Balance c/d | 14,000 | Interest A/c (28,000 × 8%) | 2,240 |
30,240 | 30,240 | ||
Bank A/c (14,000+ 1,120) | 15,120 | Balance b/d | 14,000 |
Interest A/c (14,000 × 8%) | 1,120 | ||
15,120 | 15,120 | ||
Working Notes:
WN 1: Calculation of Value of Investments
WN 2: Calculation of Valuation of Goodwill
WN 3: Calculation of Gaining Ratio
Answer:
Revaluation Account | ||||
Particulars | Amount (Rs) | Particulars | Amount (Rs) | |
Plant & Machinery A/c | 5,000 | Creditors A/c | 3,600 | |
Provision for Doubtful Debts A/c | 400 | Investments A/c (17,600 – 15,000) | 2,600 | |
Patents A/c | 2,000 | Loss transferred to: | ||
X’s Capital A/c
|
600 | |||
Y’s Capital A/c
|
400 | |||
Z’s Capital A/c
|
200 | 1,200 | ||
7,400 | 7,400 | |||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | X | Y | Z | Particulars | X | Y | Z | ||
Advertisement Expenditure A/c | 2,625 | 1,750 | 875 | Balance b/d | 68,000 | 32,000 | 21,000 | ||
Goodwill A/c | 3,000 | 2,000 | 1,000 | X’s Capital A/c | 3,000 | ||||
Z’s Capital A/c | 3,000 | 2,000 | Y’s Capital A/c | 2,000 | |||||
Revaluation A/c | 600 | 400 | 200 | Workmen Compensation Reserve A/c | 4,500 | 3,000 | 1,500 | ||
Investments A/c | 17,600 | Investments Fluctuation Reserve | 3,000 | 2,000 | 1,000 | ||||
Bank A/c | 4,413 | ||||||||
Bills Payable A/c | 2,206 | ||||||||
Z’s Loan A/c | 2,206 | ||||||||
Balance c/d | 66,275 | 30,850 | |||||||
75,500 | 37,000 | 28,500 | 75,500 | 37,000 | 28,500 | ||||
Balance Sheet
as on April 01, 2014
|
|||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | ||
Capital A/cs: | Cash at Bank (5,750 – 4,413) | 1,337 | |||
X
|
66,275 | Debtors | 40,000 | ||
Y
|
30,850 | 97,125 | Less: Provision for Doubtful Debts | 2,400 | 37,600 |
Creditors | 11,400 | Plant & Machinery (50,000 – 5,000) | 45,000 | ||
Bills Payable (Z) | 2,206 | Patents (10,000 – 2,000) | 8,000 | ||
Z’s Loan | 2,206 | Stock | 30,000 | ||
Liability for Workmen Compensation | 3,000 | ||||
Employees’ Provident Fund | 6,000 | ||||
1,21,937 | 1,21,937 | ||||
Journal | |||||
Date | Particulars | L.F. | Debit Amount (Rs) | Credit Amount (Rs) |
|
X’s Capital A/c | Dr. | 3,000 | |||
Y’s Capital A/c | 2,000 | ||||
To Z’s Capital A/c
|
5,000 | ||||
(Goodwill adjusted through capitals) | |||||
X’s Capital A/c | Dr. | 3,000 | |||
Y’s Capital A/c | Dr. | 2,000 | |||
Z’s Capital A/c | Dr. | 1,000 | |||
To Goodwill A/c
|
6,000 | ||||
(Old goodwill written-off) |
Working Notes:
Page No 6.90:
Question 26:
Revaluation Account | ||||
Particulars | Amount (Rs) | Particulars | Amount (Rs) | |
Plant & Machinery A/c | 5,000 | Creditors A/c | 3,600 | |
Provision for Doubtful Debts A/c | 400 | Investments A/c (17,600 – 15,000) | 2,600 | |
Patents A/c | 2,000 | Loss transferred to: | ||
X’s Capital A/c
|
600 | |||
Y’s Capital A/c
|
400 | |||
Z’s Capital A/c
|
200 | 1,200 | ||
7,400 | 7,400 | |||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | X | Y | Z | Particulars | X | Y | Z | ||
Advertisement Expenditure A/c | 2,625 | 1,750 | 875 | Balance b/d | 68,000 | 32,000 | 21,000 | ||
Goodwill A/c | 3,000 | 2,000 | 1,000 | X’s Capital A/c | 3,000 | ||||
Z’s Capital A/c | 3,000 | 2,000 | Y’s Capital A/c | 2,000 | |||||
Revaluation A/c | 600 | 400 | 200 | Workmen Compensation Reserve A/c | 4,500 | 3,000 | 1,500 | ||
Investments A/c | 17,600 | Investments Fluctuation Reserve | 3,000 | 2,000 | 1,000 | ||||
Bank A/c | 4,413 | ||||||||
Bills Payable A/c | 2,206 | ||||||||
Z’s Loan A/c | 2,206 | ||||||||
Balance c/d | 66,275 | 30,850 | |||||||
75,500 | 37,000 | 28,500 | 75,500 | 37,000 | 28,500 | ||||
Balance Sheet
as on April 01, 2014
|
|||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | ||
Capital A/cs: | Cash at Bank (5,750 – 4,413) | 1,337 | |||
X
|
66,275 | Debtors | 40,000 | ||
Y
|
30,850 | 97,125 | Less: Provision for Doubtful Debts | 2,400 | 37,600 |
Creditors | 11,400 | Plant & Machinery (50,000 – 5,000) | 45,000 | ||
Bills Payable (Z) | 2,206 | Patents (10,000 – 2,000) | 8,000 | ||
Z’s Loan | 2,206 | Stock | 30,000 | ||
Liability for Workmen Compensation | 3,000 | ||||
Employees’ Provident Fund | 6,000 | ||||
1,21,937 | 1,21,937 | ||||
Journal | |||||
Date | Particulars | L.F. | Debit Amount (Rs) | Credit Amount (Rs) |
|
X’s Capital A/c | Dr. | 3,000 | |||
Y’s Capital A/c | 2,000 | ||||
To Z’s Capital A/c
|
5,000 | ||||
(Goodwill adjusted through capitals) | |||||
X’s Capital A/c | Dr. | 3,000 | |||
Y’s Capital A/c | Dr. | 2,000 | |||
Z’s Capital A/c | Dr. | 1,000 | |||
To Goodwill A/c
|
6,000 | ||||
(Old goodwill written-off) |
Working Notes:
Answer:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
Revaluation A/c |
Dr. |
|
3,000 |
|
To Fixed Assets A/c |
|
|
2,000 |
|
To Provision for doubtful Debts A/c |
|
|
1,000 |
|
(Decrease in value of Fixed Assets and provision for doubtful debts transferred to Revaluation Account) |
|
|
|
|
|
|
|
|
|
P’s Capital A/c |
Dr. |
|
1,200 |
|
Q’s Capital A/c |
Dr. |
|
900 |
|
R’s Capital A/c |
Dr. |
|
900 |
|
To Revaluation A/c |
|
|
3,000 |
|
(Revaluation loss distributed among partners in their old ratio) |
|
|
|
|
|
|
|
|
|
Workmen’s Compensation Reserve A/c |
Dr. |
|
10,000 |
|
To Outstanding Workmen’s Compensation A/c |
|
|
4,000 |
|
To P’s Capital A/c |
|
|
2,400 |
|
To Q’s Capital A/c |
|
|
1,800 |
|
To R’s Capital A/c |
|
|
1,800 |
|
(Workmen Compensation claim adjusted against Workmen’s Compensation Reserve and the balance amount is distributed among the partners) |
|
|
|
|
|
|
|
|
|
Reserves A/c |
Dr. |
|
10,000 |
|
To R’s Capital A/c |
|
|
4,000 |
|
To Q’s Capital A/c |
|
|
3,000 |
|
To R’s Capital A/c |
|
|
3,000 |
|
(Reserve distributed among all the partners in their old ratio) |
|
|
|
|
|
|
|
|
|
P’s Capital A/c |
Dr. |
|
13,333 |
|
Q’s Capital A/c |
Dr. |
|
1,667 |
|
To R’s Capital A/c |
|
|
15,000 |
|
(R’s share of goodwill adjusted) |
|
|
|
|
|
|
|
|
|
R’s Capital A/c |
Dr. |
|
27,900 |
|
To R’s Loan A/c |
|
|
27,900 |
|
(R’s capital balance transferred to his Loan Account) |
|
|
|
|
|
|
|
|
Balance Sheet |
|||||
as on March 31,2009 (after R’s Retirement) |
|||||
Liabilities |
Amount Rs |
Assets |
Amount Rs |
||
Creditors |
10,000 |
Cash at Bank |
20,000 |
||
Employees’ Provident Fund |
20,000 |
Debtors |
15,000 |
|
|
Outstanding Workmen’s Compensation Reserve |
4,000 |
Less: Provision for Doubtful Debts |
(1,000) |
14,000 |
|
R’s Loan |
27,900 |
Stock |
17,000 |
||
Capital A/cs: |
|
Fixed Assets (52,000 – 2,000) |
50,000 |
||
P |
21,867 |
|
|
|
|
Q |
17,233 |
39,100 |
|
|
|
|
|
1,01,000 |
|
1,01,000 |
|
|
|
|
|
R’s Loan Account |
|||||
Dr. |
|
Cr. |
|||
Date |
Particulars |
Amount Rs |
Date |
Particulars |
Amount Rs |
2010 |
|
|
2009 |
|
|
March 31 |
Bank (9,300 + 2,790) |
12,090 |
April 01 |
R’s Capital A/c |
27,900 |
2010 | |||||
March 31 |
Balance c/d |
18,600 |
March 31 |
Interest (27,900 × 10%) |
2,790 |
|
|
30,690 |
|
|
30,690 |
2011 |
|
|
2010 |
|
|
March 31 |
Bank (9,300 + 1,860) |
11,160 |
April 01 |
Balance b/d |
18,600 |
|
|
|
2011 |
|
|
March 31 |
Balance c/d |
9,300 |
March 31 |
Interest (18,600 × 10%) |
1,860 |
|
|
20,460 |
|
|
20,460 |
2012 |
|
|
2011 |
|
|
March 31 |
Bank (9,300 + 930) |
10,230 |
April 01 |
Balance b/d |
9,300 |
|
|
|
2012 |
|
|
|
|
|
March 31 |
Interest (9,300 × 10%) |
930 |
|
|
|
|
|
|
|
|
10,230 |
|
|
10,230 |
|
|
|
|
|
|
Working Notes:
WN 1
Revaluation Account |
||||
Dr. |
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Fixed Assets |
2,000 |
Loss transferred to: |
|
|
Provision for Doubtful Debts |
1,000 |
P’s Capital A/c |
1,200 |
|
|
|
Q’s Capital A/c |
900 |
|
|
|
R’s Capital A/c |
900 |
3,000 |
|
3,000 |
|
3,000 |
|
|
|
|
|
WN 2
Partners’ Capital Accounts |
|||||||
Dr. |
|
Cr. |
|||||
Particulars |
P |
Q |
R |
Particulars |
P |
Q |
R |
Drawings A/c |
|
|
6,000 |
Balance b/d |
30,000 |
15,000 |
15,000 |
R’s Capital A/c (Goodwill) |
13,333 |
1,667 |
|
Workmen’s Compensation Reserve |
2,400 |
1,800 |
1,800 |
Revaluation A/c |
1,200 |
900 |
900 |
Reserves |
4,000 |
3,000 |
3,000 |
R’s Loan A/c |
|
|
27,900 |
P’s Capital A/c (Goodwill) |
|
|
13,333 |
Balance c/d |
21,867 |
17,233 |
|
Q’s Capital A/c (Goodwill) |
|
|
1,667 |
|
36,400 |
19,800 |
34,800 |
|
36,400 |
19,800 |
34,800 |
|
|
|
|
|
|
|
|
WN 3
Calculation of Gaining Ratio
Old Ratio (P, Q and R) = 4 : 3 : 3
New Ratio (P and Q) = 2 : 1
R retires from the firm.
Gaining Ratio = New Ratio − Old Ratio
∴ Gaining Ratio = 8 : 1
WN 4
Adjustment of Goodwill
Goodwill of the firm = Rs 50,000
R’s Share of Goodwill =
This share of goodwill is to be distributed between P and R in their gaining ratio (i.e. 8 : 1).
Page No 6.90:
Question 27:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
Revaluation A/c |
Dr. |
|
3,000 |
|
To Fixed Assets A/c |
|
|
2,000 |
|
To Provision for doubtful Debts A/c |
|
|
1,000 |
|
(Decrease in value of Fixed Assets and provision for doubtful debts transferred to Revaluation Account) |
|
|
|
|
|
|
|
|
|
P’s Capital A/c |
Dr. |
|
1,200 |
|
Q’s Capital A/c |
Dr. |
|
900 |
|
R’s Capital A/c |
Dr. |
|
900 |
|
To Revaluation A/c |
|
|
3,000 |
|
(Revaluation loss distributed among partners in their old ratio) |
|
|
|
|
|
|
|
|
|
Workmen’s Compensation Reserve A/c |
Dr. |
|
10,000 |
|
To Outstanding Workmen’s Compensation A/c |
|
|
4,000 |
|
To P’s Capital A/c |
|
|
2,400 |
|
To Q’s Capital A/c |
|
|
1,800 |
|
To R’s Capital A/c |
|
|
1,800 |
|
(Workmen Compensation claim adjusted against Workmen’s Compensation Reserve and the balance amount is distributed among the partners) |
|
|
|
|
|
|
|
|
|
Reserves A/c |
Dr. |
|
10,000 |
|
To R’s Capital A/c |
|
|
4,000 |
|
To Q’s Capital A/c |
|
|
3,000 |
|
To R’s Capital A/c |
|
|
3,000 |
|
(Reserve distributed among all the partners in their old ratio) |
|
|
|
|
|
|
|
|
|
P’s Capital A/c |
Dr. |
|
13,333 |
|
Q’s Capital A/c |
Dr. |
|
1,667 |
|
To R’s Capital A/c |
|
|
15,000 |
|
(R’s share of goodwill adjusted) |
|
|
|
|
|
|
|
|
|
R’s Capital A/c |
Dr. |
|
27,900 |
|
To R’s Loan A/c |
|
|
27,900 |
|
(R’s capital balance transferred to his Loan Account) |
|
|
|
|
|
|
|
|
Balance Sheet |
|||||
as on March 31,2009 (after R’s Retirement) |
|||||
Liabilities |
Amount Rs |
Assets |
Amount Rs |
||
Creditors |
10,000 |
Cash at Bank |
20,000 |
||
Employees’ Provident Fund |
20,000 |
Debtors |
15,000 |
|
|
Outstanding Workmen’s Compensation Reserve |
4,000 |
Less: Provision for Doubtful Debts |
(1,000) |
14,000 |
|
R’s Loan |
27,900 |
Stock |
17,000 |
||
Capital A/cs: |
|
Fixed Assets (52,000 – 2,000) |
50,000 |
||
P |
21,867 |
|
|
|
|
Q |
17,233 |
39,100 |
|
|
|
|
|
1,01,000 |
|
1,01,000 |
|
|
|
|
|
R’s Loan Account |
|||||
Dr. |
|
Cr. |
|||
Date |
Particulars |
Amount Rs |
Date |
Particulars |
Amount Rs |
2010 |
|
|
2009 |
|
|
March 31 |
Bank (9,300 + 2,790) |
12,090 |
April 01 |
R’s Capital A/c |
27,900 |
2010 | |||||
March 31 |
Balance c/d |
18,600 |
March 31 |
Interest (27,900 × 10%) |
2,790 |
|
|
30,690 |
|
|
30,690 |
2011 |
|
|
2010 |
|
|
March 31 |
Bank (9,300 + 1,860) |
11,160 |
April 01 |
Balance b/d |
18,600 |
|
|
|
2011 |
|
|
March 31 |
Balance c/d |
9,300 |
March 31 |
Interest (18,600 × 10%) |
1,860 |
|
|
20,460 |
|
|
20,460 |
2012 |
|
|
2011 |
|
|
March 31 |
Bank (9,300 + 930) |
10,230 |
April 01 |
Balance b/d |
9,300 |
|
|
|
2012 |
|
|
|
|
|
March 31 |
Interest (9,300 × 10%) |
930 |
|
|
|
|
|
|
|
|
10,230 |
|
|
10,230 |
|
|
|
|
|
|
Working Notes:
WN 1
Revaluation Account |
||||
Dr. |
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Fixed Assets |
2,000 |
Loss transferred to: |
|
|
Provision for Doubtful Debts |
1,000 |
P’s Capital A/c |
1,200 |
|
|
|
Q’s Capital A/c |
900 |
|
|
|
R’s Capital A/c |
900 |
3,000 |
|
3,000 |
|
3,000 |
|
|
|
|
|
WN 2
Partners’ Capital Accounts |
|||||||
Dr. |
|
Cr. |
|||||
Particulars |
P |
Q |
R |
Particulars |
P |
Q |
R |
Drawings A/c |
|
|
6,000 |
Balance b/d |
30,000 |
15,000 |
15,000 |
R’s Capital A/c (Goodwill) |
13,333 |
1,667 |
|
Workmen’s Compensation Reserve |
2,400 |
1,800 |
1,800 |
Revaluation A/c |
1,200 |
900 |
900 |
Reserves |
4,000 |
3,000 |
3,000 |
R’s Loan A/c |
|
|
27,900 |
P’s Capital A/c (Goodwill) |
|
|
13,333 |
Balance c/d |
21,867 |
17,233 |
|
Q’s Capital A/c (Goodwill) |
|
|
1,667 |
|
36,400 |
19,800 |
34,800 |
|
36,400 |
19,800 |
34,800 |
|
|
|
|
|
|
|
|
WN 3
Calculation of Gaining Ratio
Old Ratio (P, Q and R) = 4 : 3 : 3
New Ratio (P and Q) = 2 : 1
R retires from the firm.
Gaining Ratio = New Ratio − Old Ratio
∴ Gaining Ratio = 8 : 1
WN 4
Adjustment of Goodwill
Goodwill of the firm = Rs 50,000
R’s Share of Goodwill =
This share of goodwill is to be distributed between P and R in their gaining ratio (i.e. 8 : 1).
Answer:
Revaluation Account | ||||
Particulars | Amount (Rs) | Particulars | Amount (Rs) | |
Plant & Equipment A/c | 6,000 | Building A/c | 24,000 | |
Provision for Doubtful Debts A/c | 800 | Creditors A/c | 1,000 | |
Stock A/c | 2,400 | |||
Outstanding Salary A/c | 5,000 | |||
Claim for Damages | 3,480 | |||
Profit transferred to: | ||||
P’s Capital A/c
|
3,660 | |||
Q’s Capital A/c
|
2,440 | |||
R’s Capital A/c
|
1,220 | 7,320 | ||
25,000 | 25,000 | |||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | P | Q | R | Particulars | P | Q | R | ||
P’s Loan A/c | 48,000 | − | − | Balance b/d | 48,000 | 24,000 | 12,000 | ||
Balance c/d | − | 24,000 | 12,000 | ||||||
48,000 | 24,000 | 12,000 | 48,000 | 24,000 | 12,000 | ||||
Partners’ Current Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | P | Q | R | Particulars | P | Q | R | ||
P’s Current A/c | − | 9,600 | 4,800 | Balance b/d | 3,840 | 3,360 | 2,240 | ||
Bank A/c | 21,900 | − | − | Q’s Current A/c | 9,600 | − | − | ||
R’s Current A/c | 4,800 | − | − | ||||||
Revaluation A/c | 3,660 | 2,440 | 1,220 | ||||||
Balance c/d | − | 3,800 | 1,340 | ||||||
21,900 | 9,600 | 4,800 | 21,900 | 9,600 | 4,800 | ||||
Balance Sheet
as on March 31, 2016
|
|||||
Liabilities | Amount (Rs) |
Assets | Amount (Rs) | ||
Capital A/cs: | Building (24,000 + 24,000) | 48,000 | |||
Q
|
24,000 | Debtors | 24,800 | ||
R
|
12,000 | 36,000 |
Less: Provision for Doubtful Debts
|
3,200 | 21,600 |
Creditors (31,200 – 1,000) | 30,200 | Plant & Equipment | 31,600 | ||
Outstanding Salary | 5,000 | Bank | 340 | ||
P’s Loan | 48,000 | Stock (18,400 – 2,400) | 16,000 | ||
Claims for Damages | 3,480 | Current A/cs: | |||
Q
|
3,800 | ||||
R
|
1,340 | 5,140 | |||
1,22,680 | 1,22,680 | ||||
Working Notes:
WN 1: Calculation of Gaining Ratio
Bank Account | |||
Particulars | Amount (Rs) | Amount (Rs) | |
Balance b/d | 32,240 | P’s Loan A/c | 10,000 |
P’s Current A/c | 21,900 | ||
Balance c/d | 340 | ||
32,240 | 32,240 | ||
Page No 6.91:
Question 28:
Revaluation Account | ||||
Particulars | Amount (Rs) | Particulars | Amount (Rs) | |
Plant & Equipment A/c | 6,000 | Building A/c | 24,000 | |
Provision for Doubtful Debts A/c | 800 | Creditors A/c | 1,000 | |
Stock A/c | 2,400 | |||
Outstanding Salary A/c | 5,000 | |||
Claim for Damages | 3,480 | |||
Profit transferred to: | ||||
P’s Capital A/c
|
3,660 | |||
Q’s Capital A/c
|
2,440 | |||
R’s Capital A/c
|
1,220 | 7,320 | ||
25,000 | 25,000 | |||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | P | Q | R | Particulars | P | Q | R | ||
P’s Loan A/c | 48,000 | − | − | Balance b/d | 48,000 | 24,000 | 12,000 | ||
Balance c/d | − | 24,000 | 12,000 | ||||||
48,000 | 24,000 | 12,000 | 48,000 | 24,000 | 12,000 | ||||
Partners’ Current Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | P | Q | R | Particulars | P | Q | R | ||
P’s Current A/c | − | 9,600 | 4,800 | Balance b/d | 3,840 | 3,360 | 2,240 | ||
Bank A/c | 21,900 | − | − | Q’s Current A/c | 9,600 | − | − | ||
R’s Current A/c | 4,800 | − | − | ||||||
Revaluation A/c | 3,660 | 2,440 | 1,220 | ||||||
Balance c/d | − | 3,800 | 1,340 | ||||||
21,900 | 9,600 | 4,800 | 21,900 | 9,600 | 4,800 | ||||
Balance Sheet
as on March 31, 2016
|
|||||
Liabilities | Amount (Rs) |
Assets | Amount (Rs) | ||
Capital A/cs: | Building (24,000 + 24,000) | 48,000 | |||
Q
|
24,000 | Debtors | 24,800 | ||
R
|
12,000 | 36,000 |
Less: Provision for Doubtful Debts
|
3,200 | 21,600 |
Creditors (31,200 – 1,000) | 30,200 | Plant & Equipment | 31,600 | ||
Outstanding Salary | 5,000 | Bank | 340 | ||
P’s Loan | 48,000 | Stock (18,400 – 2,400) | 16,000 | ||
Claims for Damages | 3,480 | Current A/cs: | |||
Q
|
3,800 | ||||
R
|
1,340 | 5,140 | |||
1,22,680 | 1,22,680 | ||||
Working Notes:
WN 1: Calculation of Gaining Ratio
Bank Account | |||
Particulars | Amount (Rs) | Amount (Rs) | |
Balance b/d | 32,240 | P’s Loan A/c | 10,000 |
P’s Current A/c | 21,900 | ||
Balance c/d | 340 | ||
32,240 | 32,240 | ||
Answer:
Revaluation Account | ||||
Particulars | Amount (Rs) |
Particulars | Amount (Rs) | |
Plant A/c | 80,000 | Building A/c | 2,00,000 | |
Provision for Doubtful Debts A/c | 30,000 | |||
Furniture A/c | 12,000 | |||
Profit transferred to: | ||||
X’s Capital A/c
|
39,000 | |||
Y’s Capital A/c
|
26,000 | |||
Z’s Capital A/c
|
13,000 | 78,000 | ||
2,00,000 | 2,00,000 | |||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | X | Y | Z | Particulars | X | Y | Z | ||
Z’s Capital A/c | 72,000 | 48,000 | − | Balance b/d | 9,00,000 | 7,00,000 | 5,00,000 | ||
Bank A/c | − | − | 7,23,000 | General Reserve A/c | 1,50,000 | 1,00,000 | 50,000 | ||
Balance c/d | 15,64,800 | 11,43,200 | − | Workmen Compensation Reserve A/c | 1,20,000 | 80,000 | 40,000 | ||
Revaluation A/c | 39,000 | 26,000 | 13,000 | ||||||
X’s Capital A/c | − | − | 72,000 | ||||||
Y’s Capital A/c | − | − | 48,000 | ||||||
Bank A/c | 4,27,800 | 2,85,200 | − | ||||||
16,36,800 | 11,91,200 | 7,23,000 | 16,36,800 | 11,91,200 | 7,23,000 | ||||
Balance Sheet
as on March 31, 2016
|
|||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | ||
Capital A/cs: | Building (10,00,000 + 2,00,000) | 12,00,000 | |||
X
|
15,64,800 | Debtors | 6,00,000 | ||
Z
|
11,43,200 | 27,08,000 |
Less: Provision for Doubtful Debts
|
30,000 | 5,70,000 |
Creditors | 4,10,000 | Plant (8,00,000 – 80,000) | 7,20,000 | ||
Furniture (80,000 – 12,000) | 68,000 | ||||
Cash at Bank | 60,000 | ||||
Stock | 5,00,000 | ||||
31,18,000 | 31,18,000 | ||||
Working Notes: Calculation of Cash to be brought in by X and Y
Amount to be paid to Z – Cash at Bank + Minimum Cash Balance
7,23,000 – 70,000 + 60,000 = Rs 7,13,000
Thus, amount to be brought in by X = Rs 4,27,800
Amount to be brought in by Y = Rs 2,85,200
Page No 6.91:
Question 29:
Revaluation Account | ||||
Particulars | Amount (Rs) |
Particulars | Amount (Rs) | |
Plant A/c | 80,000 | Building A/c | 2,00,000 | |
Provision for Doubtful Debts A/c | 30,000 | |||
Furniture A/c | 12,000 | |||
Profit transferred to: | ||||
X’s Capital A/c
|
39,000 | |||
Y’s Capital A/c
|
26,000 | |||
Z’s Capital A/c
|
13,000 | 78,000 | ||
2,00,000 | 2,00,000 | |||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | X | Y | Z | Particulars | X | Y | Z | ||
Z’s Capital A/c | 72,000 | 48,000 | − | Balance b/d | 9,00,000 | 7,00,000 | 5,00,000 | ||
Bank A/c | − | − | 7,23,000 | General Reserve A/c | 1,50,000 | 1,00,000 | 50,000 | ||
Balance c/d | 15,64,800 | 11,43,200 | − | Workmen Compensation Reserve A/c | 1,20,000 | 80,000 | 40,000 | ||
Revaluation A/c | 39,000 | 26,000 | 13,000 | ||||||
X’s Capital A/c | − | − | 72,000 | ||||||
Y’s Capital A/c | − | − | 48,000 | ||||||
Bank A/c | 4,27,800 | 2,85,200 | − | ||||||
16,36,800 | 11,91,200 | 7,23,000 | 16,36,800 | 11,91,200 | 7,23,000 | ||||
Balance Sheet
as on March 31, 2016
|
|||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | ||
Capital A/cs: | Building (10,00,000 + 2,00,000) | 12,00,000 | |||
X
|
15,64,800 | Debtors | 6,00,000 | ||
Z
|
11,43,200 | 27,08,000 |
Less: Provision for Doubtful Debts
|
30,000 | 5,70,000 |
Creditors | 4,10,000 | Plant (8,00,000 – 80,000) | 7,20,000 | ||
Furniture (80,000 – 12,000) | 68,000 | ||||
Cash at Bank | 60,000 | ||||
Stock | 5,00,000 | ||||
31,18,000 | 31,18,000 | ||||
Working Notes: Calculation of Cash to be brought in by X and Y
Amount to be paid to Z – Cash at Bank + Minimum Cash Balance
7,23,000 – 70,000 + 60,000 = Rs 7,13,000
Thus, amount to be brought in by X = Rs 4,27,800
Amount to be brought in by Y = Rs 2,85,200
Answer:
Journal | |||||
Date | Particulars | L.F. | Debit Amount (Rs) | Credit Amount (Rs) | |
X’s Capital A/c | Dr. | 4,300 | |||
To Cash A/c
|
4,300 | ||||
(Excess balance of cash withdrawn by X) | |||||
Cash A/c | Dr. | 2,700 | |||
To Z’s Capital A/c
|
2,700 | ||||
(Deficiency amount brought in by Z) | |||||
Working Notes: Calculation of Cash to be brought in or paid to X and Z
Page No 6.92:
Question 30:
Journal | |||||
Date | Particulars | L.F. | Debit Amount (Rs) | Credit Amount (Rs) | |
X’s Capital A/c | Dr. | 4,300 | |||
To Cash A/c
|
4,300 | ||||
(Excess balance of cash withdrawn by X) | |||||
Cash A/c | Dr. | 2,700 | |||
To Z’s Capital A/c
|
2,700 | ||||
(Deficiency amount brought in by Z) | |||||
Working Notes: Calculation of Cash to be brought in or paid to X and Z
Answer:
Revaluation Account |
||||
Dr. |
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Plant (30,000 × 10%) |
3,000 |
Expenses Owing (2,000 – 1,500) |
500 |
|
|
|
Patents (4,000 – 3,000) |
1,000 |
|
|
|
Loss transferred to: |
|
|
|
|
Manoj’s Capital A/c |
750 |
|
|
|
Naveen’s Capital A/c |
500 |
|
|
|
Deepak’s Capital A/c |
250 |
1,500 |
|
3,000 |
|
3,000 |
|
|
|
|
|
Partners’ Capital Account |
||||||||
Dr. |
|
Cr. |
||||||
Particulars |
Manoj |
Naveen |
Deepak |
Particulars |
Manoj |
Naveen |
Deepak |
|
Revaluation |
750 |
500 |
250 |
Balance b/d |
12,000 |
10,000 |
9,000 |
|
Naveen’s Capital A/c |
1,200 |
|
2,800 |
General Reserve |
3,000 |
2,000 |
1,000 |
|
Naveen’s Loan A/c |
|
15,500 |
|
Manoj Capital A/c |
|
1,200 |
|
|
Balance c/d |
13,050 |
|
6,950 |
Deepak Capital A/c |
|
2,800 |
|
|
|
15,000 |
16,000 |
10,000 |
|
15,000 |
16,000 |
10,000 |
|
|
|
|
|
Balance b/d |
13,050 |
|
6,950 |
|
Balance c/d |
15,000 |
|
10,000 |
Cash A/c |
1,950 |
|
3,050 |
|
|
15,000 |
|
10,000 |
|
15,000 |
|
10,000 |
|
|
|
|
|
|
|
|
|
Balance Sheet |
||||
as on April 01, 2014 |
||||
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
Expense Owing |
1,500 |
Plant (30,000 – 3,000) |
27,000 |
|
Bills Payable |
5,000 |
Patents |
4,000 |
|
Creditors |
10,000 |
Debtors |
9,500 |
|
Naveen’s Loan |
15,500 |
Stock |
11,000 |
|
Capital A/cs: |
|
Cash (WN 4) |
5,500 |
|
Manoj |
15,000 |
|
|
|
Deepak |
10,000 |
25,000 |
|
|
|
57,000 |
|
57,000 |
|
|
|
|
|
Working Notes:
WN 1 Calculation of Gaining Ratio
Old Ratio = 3 : 2 : 1
Naveen retires from the firm.
New Ratio = 3 : 2
Gaining Ratio = New Ratio – Old Ratio
∴ Gaining Ratio = 3: 7
WN 2 Adjustment of Goodwill
Goodwill of the firm = Rs 12,000
Naveen’s Share of Goodwill =
This share of goodwill is to be distributed between Manoj and Deepak in their gaining ratio (i.e.3 : 7).
WN 3 Adjustment of Capital
Cash Account
|
|||||
Dr. |
Cr. |
||||
Particulars
|
Amount
Rs
|
Particulars
|
Amount
Rs
|
||
Balance b/d
|
500
|
|
|
||
Manoj’s Capital
|
1,950
|
|
|
||
Deepak’s Capital
|
3,050
|
Balance c/d
|
5,500
|
||
|
5,500
|
|
5,500
|
||
Page No 6.92:
Question 31:
Revaluation Account |
||||
Dr. |
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Plant (30,000 × 10%) |
3,000 |
Expenses Owing (2,000 – 1,500) |
500 |
|
|
|
Patents (4,000 – 3,000) |
1,000 |
|
|
|
Loss transferred to: |
|
|
|
|
Manoj’s Capital A/c |
750 |
|
|
|
Naveen’s Capital A/c |
500 |
|
|
|
Deepak’s Capital A/c |
250 |
1,500 |
|
3,000 |
|
3,000 |
|
|
|
|
|
Partners’ Capital Account |
||||||||
Dr. |
|
Cr. |
||||||
Particulars |
Manoj |
Naveen |
Deepak |
Particulars |
Manoj |
Naveen |
Deepak |
|
Revaluation |
750 |
500 |
250 |
Balance b/d |
12,000 |
10,000 |
9,000 |
|
Naveen’s Capital A/c |
1,200 |
|
2,800 |
General Reserve |
3,000 |
2,000 |
1,000 |
|
Naveen’s Loan A/c |
|
15,500 |
|
Manoj Capital A/c |
|
1,200 |
|
|
Balance c/d |
13,050 |
|
6,950 |
Deepak Capital A/c |
|
2,800 |
|
|
|
15,000 |
16,000 |
10,000 |
|
15,000 |
16,000 |
10,000 |
|
|
|
|
|
Balance b/d |
13,050 |
|
6,950 |
|
Balance c/d |
15,000 |
|
10,000 |
Cash A/c |
1,950 |
|
3,050 |
|
|
15,000 |
|
10,000 |
|
15,000 |
|
10,000 |
|
|
|
|
|
|
|
|
|
Balance Sheet |
||||
as on April 01, 2014 |
||||
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
Expense Owing |
1,500 |
Plant (30,000 – 3,000) |
27,000 |
|
Bills Payable |
5,000 |
Patents |
4,000 |
|
Creditors |
10,000 |
Debtors |
9,500 |
|
Naveen’s Loan |
15,500 |
Stock |
11,000 |
|
Capital A/cs: |
|
Cash (WN 4) |
5,500 |
|
Manoj |
15,000 |
|
|
|
Deepak |
10,000 |
25,000 |
|
|
|
57,000 |
|
57,000 |
|
|
|
|
|
Working Notes:
WN 1 Calculation of Gaining Ratio
Old Ratio = 3 : 2 : 1
Naveen retires from the firm.
New Ratio = 3 : 2
Gaining Ratio = New Ratio – Old Ratio
∴ Gaining Ratio = 3: 7
WN 2 Adjustment of Goodwill
Goodwill of the firm = Rs 12,000
Naveen’s Share of Goodwill =
This share of goodwill is to be distributed between Manoj and Deepak in their gaining ratio (i.e.3 : 7).
WN 3 Adjustment of Capital
Cash Account
|
|||||
Dr. |
Cr. |
||||
Particulars
|
Amount
Rs
|
Particulars
|
Amount
Rs
|
||
Balance b/d
|
500
|
|
|
||
Manoj’s Capital
|
1,950
|
|
|
||
Deepak’s Capital
|
3,050
|
Balance c/d
|
5,500
|
||
|
5,500
|
|
5,500
|
||
Answer:
Profit & Loss Adjustment Account | ||||
Particulars | Amount (Rs) | Particulars | Amount (Rs) | |
Stock A/c | 2,400 | Factory Building A/c | 25,000 | |
Provision for Legal Charges A/c | 3,850 | |||
Provision for Doubtful Debts A/c | 750 | |||
Profit transferred to: | ||||
A’s Capital A/c
|
8,000 | |||
B’s Capital A/c
|
6,000 | |||
C’s Capital A/c
|
4,000 | 18,000 | ||
25,000 | 25,000 | |||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | A | B | C | Particulars | A | B | C | ||
B’s Capital A/c | 12,000 | − | 6,000 | Balance b/d | 1,00,000 | 75,000 | 50,000 | ||
B’s Loan A/c | − | 99,000 | − | A’s Capital A/c | − | 12,000 | − | ||
Bank A/c (Balancing Figure) | 2,667 | − | 1,333 | C’s Capital A/c | − | 6,000 | − | ||
Balance c/d | 93,333 | − | 46,667 | Profit & Loss Adjustment A/c | 8,000 | 6,000 | 4,000 | ||
1,08,000 | 99,000 | 54,000 | 1,08,000 | 99,000 | 54,000 | ||||
Bank Account | |||
Particulars | Amount (Rs) | Amount (Rs) | |
Balance b/d | 27,500 | A’s Capital A/c | 2,667 |
C’s Capital A/c | 1,333 | ||
Balance c/d | 23,500 | ||
27,500 | 27,500 | ||
Balance Sheet
as at March 31, 2015
|
|||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | ||
Capital A/cs: | Factory Building (1,25,000 + 25,000) | 1,50,000 | |||
A
|
93,333 | Debtors | 25,000 | ||
C
|
46,667 | 1,40,000 |
Less: Provision for Doubtful Debts
|
1,250 | 23,750 |
B’s Loan A/c | 99,000 | Stock (40,000 – 2,400) | 37,600 | ||
Creditors | 24,500 | Bank | 23,500 | ||
Bills Payable | 10,000 | Plant & Machinery | 42,500 | ||
Provision for Legal Charges | 3,850 | ||||
2,77,350 | 2,77,350 | ||||
Working Notes: Calculation of New Capital of Existing Partners
Page No 6.92:
Question 32:
Profit & Loss Adjustment Account | ||||
Particulars | Amount (Rs) | Particulars | Amount (Rs) | |
Stock A/c | 2,400 | Factory Building A/c | 25,000 | |
Provision for Legal Charges A/c | 3,850 | |||
Provision for Doubtful Debts A/c | 750 | |||
Profit transferred to: | ||||
A’s Capital A/c
|
8,000 | |||
B’s Capital A/c
|
6,000 | |||
C’s Capital A/c
|
4,000 | 18,000 | ||
25,000 | 25,000 | |||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | A | B | C | Particulars | A | B | C | ||
B’s Capital A/c | 12,000 | − | 6,000 | Balance b/d | 1,00,000 | 75,000 | 50,000 | ||
B’s Loan A/c | − | 99,000 | − | A’s Capital A/c | − | 12,000 | − | ||
Bank A/c (Balancing Figure) | 2,667 | − | 1,333 | C’s Capital A/c | − | 6,000 | − | ||
Balance c/d | 93,333 | − | 46,667 | Profit & Loss Adjustment A/c | 8,000 | 6,000 | 4,000 | ||
1,08,000 | 99,000 | 54,000 | 1,08,000 | 99,000 | 54,000 | ||||
Bank Account | |||
Particulars | Amount (Rs) | Amount (Rs) | |
Balance b/d | 27,500 | A’s Capital A/c | 2,667 |
C’s Capital A/c | 1,333 | ||
Balance c/d | 23,500 | ||
27,500 | 27,500 | ||
Balance Sheet
as at March 31, 2015
|
|||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | ||
Capital A/cs: | Factory Building (1,25,000 + 25,000) | 1,50,000 | |||
A
|
93,333 | Debtors | 25,000 | ||
C
|
46,667 | 1,40,000 |
Less: Provision for Doubtful Debts
|
1,250 | 23,750 |
B’s Loan A/c | 99,000 | Stock (40,000 – 2,400) | 37,600 | ||
Creditors | 24,500 | Bank | 23,500 | ||
Bills Payable | 10,000 | Plant & Machinery | 42,500 | ||
Provision for Legal Charges | 3,850 | ||||
2,77,350 | 2,77,350 | ||||
Working Notes: Calculation of New Capital of Existing Partners
Answer:
Note: Since, Z's New Capital is more than his Existing Capital, therefore Z will bring in Rs 4,500 (not withdraw, as given in the textbook).
Page No 6.93:
Question 33:
Note: Since, Z's New Capital is more than his Existing Capital, therefore Z will bring in Rs 4,500 (not withdraw, as given in the textbook).
Answer:
Revaluation Account | ||||
Particulars | Amount (Rs) | Particulars | Amount (Rs) | |
Provision for Doubtful Debts A/c | 1,000 | Creditors A/c | 6,000 | |
Stock A/c | 1,800 | |||
Furniture A/c | 1,500 | |||
Liability for Workmen Compensation A/c | 1,100 | |||
Profit transferred to: | ||||
X’s Capital A/c
|
300 | |||
Y’s Capital A/c
|
200 | |||
Z’s Capital A/c
|
100 | 600 | ||
6,000 | 6,000 | |||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | X | Y | Z | Particulars | X | Y | Z | ||
Y’s Capital A/c | 2,200 | 5,133 | Balance b/d | 40,000 | 40,000 | 30,000 | |||
Goodwill A/c | 5,000 | 3,333 | 1,667 | General Reserve A/c | 6,000 | 4,000 | 2,000 | ||
Bank A/c | 48,200 | X’s Capital A/c | 2,200 | ||||||
Balance c/d | 67,560 | 45,040 | Z’s Capital A/c | 5,133 | |||||
Revaluation A/c | 300 | 200 | 100 | ||||||
Bank A/c (Balancing figure) |
28,460 | 19,740 | |||||||
74,760 | 51,533 | 51,840 | 74,760 | 51,533 | 51,840 | ||||
Balance Sheet
as on March 31, 2014
|
|||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | ||
Capital A/cs: | Machinery | 70,000 | |||
X
|
67,560 | Debtors | 25,000 | ||
Y
|
45,040 | 1,12,600 |
Less: Provision for Doubtful Debts
|
4,000 | 21,000 |
Creditors (40,000 – 6,000) | 34,000 | Furniture (30,000 – 1,500) | 28,500 | ||
Bills Payable | 6,000 | Bank | 18,000 | ||
Liability for Workmen Compensation | 1,100 | Stock (18,000 – 1,800) | 16,200 | ||
1,53,700 | 1,53,700 | ||||
Working Notes:
WN 1: Calculation of Gaining Ratio
WN 2: Calculation of New Capital
Page No 6.93:
Question 34:
Revaluation Account | ||||
Particulars | Amount (Rs) | Particulars | Amount (Rs) | |
Provision for Doubtful Debts A/c | 1,000 | Creditors A/c | 6,000 | |
Stock A/c | 1,800 | |||
Furniture A/c | 1,500 | |||
Liability for Workmen Compensation A/c | 1,100 | |||
Profit transferred to: | ||||
X’s Capital A/c
|
300 | |||
Y’s Capital A/c
|
200 | |||
Z’s Capital A/c
|
100 | 600 | ||
6,000 | 6,000 | |||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | X | Y | Z | Particulars | X | Y | Z | ||
Y’s Capital A/c | 2,200 | 5,133 | Balance b/d | 40,000 | 40,000 | 30,000 | |||
Goodwill A/c | 5,000 | 3,333 | 1,667 | General Reserve A/c | 6,000 | 4,000 | 2,000 | ||
Bank A/c | 48,200 | X’s Capital A/c | 2,200 | ||||||
Balance c/d | 67,560 | 45,040 | Z’s Capital A/c | 5,133 | |||||
Revaluation A/c | 300 | 200 | 100 | ||||||
Bank A/c (Balancing figure) |
28,460 | 19,740 | |||||||
74,760 | 51,533 | 51,840 | 74,760 | 51,533 | 51,840 | ||||
Balance Sheet
as on March 31, 2014
|
|||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | ||
Capital A/cs: | Machinery | 70,000 | |||
X
|
67,560 | Debtors | 25,000 | ||
Y
|
45,040 | 1,12,600 |
Less: Provision for Doubtful Debts
|
4,000 | 21,000 |
Creditors (40,000 – 6,000) | 34,000 | Furniture (30,000 – 1,500) | 28,500 | ||
Bills Payable | 6,000 | Bank | 18,000 | ||
Liability for Workmen Compensation | 1,100 | Stock (18,000 – 1,800) | 16,200 | ||
1,53,700 | 1,53,700 | ||||
Working Notes:
WN 1: Calculation of Gaining Ratio
WN 2: Calculation of New Capital
Answer:
Page No 6.93:
Question 35:
Answer:
Revaluation Account |
||||
Dr. |
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Stock (32,000 × 6%) |
1,920 |
Building (1,00,000 × 20%) |
20,000 |
|
Provision for Doubtful Debts (1,000 – 400) |
600 |
|
|
|
Provision for Legal Charges |
3,080 |
|
|
|
Profit transferred to: |
|
|
|
|
A’s Capital A/c |
6,400 |
|
|
|
B’s Capital A/c |
4,800 |
|
|
|
C’s Capital A/c |
3,200 |
14,400 |
|
|
|
20,000 |
|
20,000 |
|
|
|
|
|
Partners’ Capital Account |
|||||||
Dr. |
|
Cr. |
|||||
Particulars |
A |
B |
C |
Particulars |
A |
B |
C |
B’s Capital A/c (Goodwill) |
7,800 |
|
6,600 |
Balance b/d |
80,000 |
60,000 |
40,000 |
B’s Loan |
|
79,200 |
|
Revaluation A/c (Profit) |
6,400 |
4,800 |
3,200 |
Balance c/d |
78,600 |
|
36,600 |
A’s Capital A/c (Goodwill) |
|
7,800 |
|
|
|
|
|
B’s Capital A/c (Goodwill) |
|
6,600 |
|
|
86,400 |
79,200 |
43,200 |
|
86,400 |
79,200 |
43,200 |
Cash A/c |
8,600 |
|
|
Balance b/d |
78,600 |
|
36,600 |
Balance c/d (WN 3) |
70,000 |
|
42,000 |
Cash A/c |
|
|
5,400 |
|
78,600 |
|
42,000 |
|
78,600 |
|
42,000 |
|
|
|
|
|
|
|
|
Balance Sheet |
|||||
as on March 31, 2016 (after B’s Retirement) |
|||||
Liabilities |
Amount Rs |
Assets |
Amount Rs |
||
Creditors |
27,600 |
Cash at Bank |
18,800 |
||
Provision for Legal Charges |
3,080 |
Debtors |
20,000 |
|
|
B’s Loan |
79,200 |
Less: Provision for Doubtful Debts |
(1,000) |
19,000 |
|
Capital A/cs: |
|
Stock (32,000 – 1,920) |
30,080 |
||
A |
70,000 |
|
Machinery |
34,000 |
|
C |
42,000 |
1,12,000 |
Building (1,00,000 + 20,000) |
1,20,000 |
|
|
2,21,880 |
|
2,21,880 |
||
|
|
|
|
Bank Account |
|||
Dr. |
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
Balance b/d |
22,000 |
A’s Capital A/c |
8,600 |
C’s Capital A/c |
5,400 |
Balance c/d |
18,800 |
|
27,400 |
|
27,400 |
|
|
|
|
Working Notes:
WN 1 Calculation of Profit Sharing Ratio
B retires from the firm.
New Ratio (A and C) = 5 : 3
Gaining Ratio = New Ratio − Old Ratio
∴ Gaining Ratio = 13 : 11
WN 2 Adjustment of Goodwill
Goodwill of the firm = Rs 43,200
B’s Share of Goodwill =
This share of goodwill is to be distributed between A and C in their gaining ratio (i.e. 13 : 11).
WN 3 Adjustment of Partners’ Capital after B’s Retirement
Total Capital of the New Firm (after B’s retirement) = Rs 1,12,000
New Ratio = 5 : 3
Page No 6.94:
Question 36:
Revaluation Account |
||||
Dr. |
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Stock (32,000 × 6%) |
1,920 |
Building (1,00,000 × 20%) |
20,000 |
|
Provision for Doubtful Debts (1,000 – 400) |
600 |
|
|
|
Provision for Legal Charges |
3,080 |
|
|
|
Profit transferred to: |
|
|
|
|
A’s Capital A/c |
6,400 |
|
|
|
B’s Capital A/c |
4,800 |
|
|
|
C’s Capital A/c |
3,200 |
14,400 |
|
|
|
20,000 |
|
20,000 |
|
|
|
|
|
Partners’ Capital Account |
|||||||
Dr. |
|
Cr. |
|||||
Particulars |
A |
B |
C |
Particulars |
A |
B |
C |
B’s Capital A/c (Goodwill) |
7,800 |
|
6,600 |
Balance b/d |
80,000 |
60,000 |
40,000 |
B’s Loan |
|
79,200 |
|
Revaluation A/c (Profit) |
6,400 |
4,800 |
3,200 |
Balance c/d |
78,600 |
|
36,600 |
A’s Capital A/c (Goodwill) |
|
7,800 |
|
|
|
|
|
B’s Capital A/c (Goodwill) |
|
6,600 |
|
|
86,400 |
79,200 |
43,200 |
|
86,400 |
79,200 |
43,200 |
Cash A/c |
8,600 |
|
|
Balance b/d |
78,600 |
|
36,600 |
Balance c/d (WN 3) |
70,000 |
|
42,000 |
Cash A/c |
|
|
5,400 |
|
78,600 |
|
42,000 |
|
78,600 |
|
42,000 |
|
|
|
|
|
|
|
|
Balance Sheet |
|||||
as on March 31, 2016 (after B’s Retirement) |
|||||
Liabilities |
Amount Rs |
Assets |
Amount Rs |
||
Creditors |
27,600 |
Cash at Bank |
18,800 |
||
Provision for Legal Charges |
3,080 |
Debtors |
20,000 |
|
|
B’s Loan |
79,200 |
Less: Provision for Doubtful Debts |
(1,000) |
19,000 |
|
Capital A/cs: |
|
Stock (32,000 – 1,920) |
30,080 |
||
A |
70,000 |
|
Machinery |
34,000 |
|
C |
42,000 |
1,12,000 |
Building (1,00,000 + 20,000) |
1,20,000 |
|
|
2,21,880 |
|
2,21,880 |
||
|
|
|
|
Bank Account |
|||
Dr. |
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
Balance b/d |
22,000 |
A’s Capital A/c |
8,600 |
C’s Capital A/c |
5,400 |
Balance c/d |
18,800 |
|
27,400 |
|
27,400 |
|
|
|
|
Working Notes:
WN 1 Calculation of Profit Sharing Ratio
B retires from the firm.
New Ratio (A and C) = 5 : 3
Gaining Ratio = New Ratio − Old Ratio
∴ Gaining Ratio = 13 : 11
WN 2 Adjustment of Goodwill
Goodwill of the firm = Rs 43,200
B’s Share of Goodwill =
This share of goodwill is to be distributed between A and C in their gaining ratio (i.e. 13 : 11).
WN 3 Adjustment of Partners’ Capital after B’s Retirement
Total Capital of the New Firm (after B’s retirement) = Rs 1,12,000
New Ratio = 5 : 3
Answer:
Revaluation Account | |||
Particulars | Amount (Rs) | Particulars | Amount (Rs) |
Provision for Doubtful Debts A/c | 10,000 | Sundry Creditors A/c | 10,000 |
Stock A/c | 20,000 | Land & Building A/c | 60,000 |
Machinery A/c | 40,000 | ||
70,000 | 70,000 | ||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | Ram | Rahul | Rohit | Particulars | Ram | Rahul | Rohit | ||
Ram’s Capital A/c | − | 30,000 | 60,000 | Balance b/d | 3,00,000 | 2,00,000 | 1,00,000 | ||
Bank A/c | 2,10,000 | − | − | General Reserve A/c | 30,000 | 20,000 | 10,000 | ||
Ram’s Loan A/c | 2,10,000 | − | − | Rahul’s Capital A/c | 30,000 | − | − | ||
Balance c/d | 3,00,000 | 3,00,000 | Rohit’s Capital A/c | 60,000 | − | − | |||
Bank A/c (Balancing figure) |
− | 1,10,000 | 2,50,000 | ||||||
4,20,000 | 3,30,000 | 3,60,000 | 4,20,000 | 3,30,000 | 3,60,000 | ||||
Balance Sheet
as on March 31, 2016
|
|||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | ||
Capital : | Machinery (2,00,000 – 40,000) | 1,60,000 | |||
Ram
|
3,00,000 | Debtors | 2,00,000 | ||
Rohit
|
3,00,000 | 6,00,000 |
Less: Provision
|
10,000 | 1,90,000 |
Creditors (2,00,000 – 10,000) | 1,90,000 | Land & Building (2,00,000 + 60,000) | 2,60,000 | ||
Ram’s Loan | 2,10,000 | Bank | 3,10,000 | ||
Stock (1,00,000 – 20,000) | 80,000 | ||||
10,00,000 | 10,00,000 | ||||
Working Notes:
WN 1: Calculation of Gaining Ratio
WN 2: Calculation of New Capital of Rahul and Rohit
Bank Account | |||
Particulars | Amount (Rs) |
Particulars | Amount (Rs) |
Balance b/d | 1,60,000 | Ram’s Capital A/c | 2,10,000 |
Rahul’s Capital A/c | 1,10,000 | Balance c/d | 3,10,000 |
Rohit’s Capital A/c | 2,50,000 | ||
5,20,000 | 5,20,000 | ||
Page No 6.94:
Question 37:
Revaluation Account | |||
Particulars | Amount (Rs) | Particulars | Amount (Rs) |
Provision for Doubtful Debts A/c | 10,000 | Sundry Creditors A/c | 10,000 |
Stock A/c | 20,000 | Land & Building A/c | 60,000 |
Machinery A/c | 40,000 | ||
70,000 | 70,000 | ||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | Ram | Rahul | Rohit | Particulars | Ram | Rahul | Rohit | ||
Ram’s Capital A/c | − | 30,000 | 60,000 | Balance b/d | 3,00,000 | 2,00,000 | 1,00,000 | ||
Bank A/c | 2,10,000 | − | − | General Reserve A/c | 30,000 | 20,000 | 10,000 | ||
Ram’s Loan A/c | 2,10,000 | − | − | Rahul’s Capital A/c | 30,000 | − | − | ||
Balance c/d | 3,00,000 | 3,00,000 | Rohit’s Capital A/c | 60,000 | − | − | |||
Bank A/c (Balancing figure) |
− | 1,10,000 | 2,50,000 | ||||||
4,20,000 | 3,30,000 | 3,60,000 | 4,20,000 | 3,30,000 | 3,60,000 | ||||
Balance Sheet
as on March 31, 2016
|
|||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | ||
Capital : | Machinery (2,00,000 – 40,000) | 1,60,000 | |||
Ram
|
3,00,000 | Debtors | 2,00,000 | ||
Rohit
|
3,00,000 | 6,00,000 |
Less: Provision
|
10,000 | 1,90,000 |
Creditors (2,00,000 – 10,000) | 1,90,000 | Land & Building (2,00,000 + 60,000) | 2,60,000 | ||
Ram’s Loan | 2,10,000 | Bank | 3,10,000 | ||
Stock (1,00,000 – 20,000) | 80,000 | ||||
10,00,000 | 10,00,000 | ||||
Working Notes:
WN 1: Calculation of Gaining Ratio
WN 2: Calculation of New Capital of Rahul and Rohit
Bank Account | |||
Particulars | Amount (Rs) |
Particulars | Amount (Rs) |
Balance b/d | 1,60,000 | Ram’s Capital A/c | 2,10,000 |
Rahul’s Capital A/c | 1,10,000 | Balance c/d | 3,10,000 |
Rohit’s Capital A/c | 2,50,000 | ||
5,20,000 | 5,20,000 | ||
Answer:
Revaluation Account | ||||
Particulars | Amount (Rs) | Particulars | Amount (Rs) | |
Investments A/c | 50,000 | Building A/c | 4,00,000 | |
Profit transferred to: | Stock A/c | 1,00,000 | ||
A’s Capital A/c
|
1,80,000 | |||
B’s Capital A/c
|
1,80,000 | |||
C’s Capital A/c
|
90,000 | 4,50,000 | ||
5,00,000 | 5,00,000 | |||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | A | B | C | Particulars | A | B | C | ||
C’s Capital A/c | 1,06,800 | 1,06,800 | − | Balance b/d | 12,00,000 | 12,00,000 | 8,00,000 | ||
C’s Loan A/c | − | − | 12,93,600 | General Reserve A/c | 3,20,000 | 3,20,000 | 1,60,000 | ||
Balance c/d | 15,93,200 | 15,93,200 | − | A’s Capital A/c | − | − | 1,06,800 | ||
B’s Capital A/c | − | − | 1,06,800 | ||||||
Revaluation A/c | 1,80,000 | 1,80,000 | 90,000 | ||||||
Profit & Loss Suspense A/c | − | − | 30,000 | ||||||
17,00,000 | 17,00,000 | 12,93,600 | 17,00,000 | 17,00,000 | 12,93,600 | ||||
Balance Sheet
as on June 30, 2014
|
||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | |
Capital A/cs: | Building (20,00,000 + 4,00,000) | 24,00,000 | ||
A
|
15,93,200 | Investments | 2,00,000 | |
B
|
15,93,200 | 31,86,400 | Sundry Debtors | 8,00,000 |
Sundry Creditors | 2,00,000 | Cash in Hand | 2,00,000 | |
C’s Loan | 12,93,600 | Cash at Bank | 4,50,000 | |
Stock (5,00,000 + 1,00,000) | 6,00,000 | |||
Profit & Loss Suspense | 30,000 | |||
46,80,000 | 46,80,000 | |||
Working Notes:
WN 1: Calculation of Goodwill
WN 2: Calculation of C’s Share in Profit
Page No 6.95:
Question 38:
Revaluation Account | ||||
Particulars | Amount (Rs) | Particulars | Amount (Rs) | |
Investments A/c | 50,000 | Building A/c | 4,00,000 | |
Profit transferred to: | Stock A/c | 1,00,000 | ||
A’s Capital A/c
|
1,80,000 | |||
B’s Capital A/c
|
1,80,000 | |||
C’s Capital A/c
|
90,000 | 4,50,000 | ||
5,00,000 | 5,00,000 | |||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | A | B | C | Particulars | A | B | C | ||
C’s Capital A/c | 1,06,800 | 1,06,800 | − | Balance b/d | 12,00,000 | 12,00,000 | 8,00,000 | ||
C’s Loan A/c | − | − | 12,93,600 | General Reserve A/c | 3,20,000 | 3,20,000 | 1,60,000 | ||
Balance c/d | 15,93,200 | 15,93,200 | − | A’s Capital A/c | − | − | 1,06,800 | ||
B’s Capital A/c | − | − | 1,06,800 | ||||||
Revaluation A/c | 1,80,000 | 1,80,000 | 90,000 | ||||||
Profit & Loss Suspense A/c | − | − | 30,000 | ||||||
17,00,000 | 17,00,000 | 12,93,600 | 17,00,000 | 17,00,000 | 12,93,600 | ||||
Balance Sheet
as on June 30, 2014
|
||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | |
Capital A/cs: | Building (20,00,000 + 4,00,000) | 24,00,000 | ||
A
|
15,93,200 | Investments | 2,00,000 | |
B
|
15,93,200 | 31,86,400 | Sundry Debtors | 8,00,000 |
Sundry Creditors | 2,00,000 | Cash in Hand | 2,00,000 | |
C’s Loan | 12,93,600 | Cash at Bank | 4,50,000 | |
Stock (5,00,000 + 1,00,000) | 6,00,000 | |||
Profit & Loss Suspense | 30,000 | |||
46,80,000 | 46,80,000 | |||
Working Notes:
WN 1: Calculation of Goodwill
WN 2: Calculation of C’s Share in Profit
Answer:
Journal | |||||
Date | Particulars | L.F. | Debit Amount (Rs) | Credit Amount (Rs) | |
X’s Capital A/c | Dr. | 1,800 | |||
Y’s Capital A/c | Dr. | 7,200 | |||
Z’s Capital A/c | Dr. | 12,600 | |||
To W’s Capital A/c
|
21,600 | ||||
(W’s share of Profit till retirement shared by X, Y and Z in 1 : 4 :7) | |||||
X’s Capital A/c | Dr. | 5,000 | |||
Y’s Capital A/c | Dr. | 20,000 | |||
Z’s Capital A/c | Dr. | 35,000 | |||
To W’s Capital A/c
|
60,000 | ||||
(W’s share of goodwill adjusted through remaining partners capital accounts) | |||||
General Reserve A/c | Dr. | 50,000 | |||
To W’s Capital A/c
|
20,000 | ||||
To X’s Capital A/c
|
15,000 | ||||
To Y’s Capital A/c
|
10,000 | ||||
To Z’s Capital A/c
|
5,000 | ||||
(General reserve transferred to capital) | |||||
W’s Capital A/c | Dr. | 9,01,600 | |||
To W’s Loan A/c
|
9,01,600 | ||||
(Balance transferred to Loan A/c) | |||||
X’s Capital A/c | Dr. | 2,08,200 | |||
To Bank A/c
|
2,08,200 | ||||
(Amount withdrawn) | |||||
Bank A/c | Dr. | 2,59,800 | |||
To Y’s Capital A/c
|
17,200 | ||||
To Z’s Capital A/c
|
2,42,600 | ||||
(Amount invested in the business) | |||||
Partners’ Capital Accounts | |||||||||||
Dr. | Cr. | ||||||||||
Particulars | W | X | Y | Z | Particulars | W | X | Y | Z | ||
W’s Capital A/c | − | 6,800 | 27,200 | 47,600 | Balance b/d | 8,00,000 | 6,00,000 | 4,00,000 | 2,00,000 | ||
W’s Loan A/c | 9,01,600 | − | − | − | General Reserve A/c | 20,000 | 15,000 | 10,000 | 5,000 | ||
Bank A/c (Balancing Figure) |
− | 2,08,200 | − | − | X’s Capital A/c | 6,800 | − | − | − | ||
Balance c/d | − | 4,00,000 | 4,00,000 | 4,00,000 | Y’s Capital A/c | 27,200 | − | − | − | ||
Z’s Capital A/c | 47,600 | − | − | − | |||||||
Bank A/c (Balancing Figure) |
− | 17,200 | 2,42,600 | ||||||||
9,01,600 | 6,15,000 | 4,27,200 | 4,47,600 | 9,01,600 | 6,15,000 | 4,27,200 | 4,47,600 | ||||
Working Notes:
WN 1: Calculation of Profit till Retirement
WN 2: Calculation of Gaining Ratio
W : X : Y : Z = 4 : 3 : 2 : 1 (Old)
X : Y : Z = 1 : 1 : 1 (New)
WN 3: Calculation of Goodwill
Page No 6.96:
Question 39:
Journal | |||||
Date | Particulars | L.F. | Debit Amount (Rs) | Credit Amount (Rs) | |
X’s Capital A/c | Dr. | 1,800 | |||
Y’s Capital A/c | Dr. | 7,200 | |||
Z’s Capital A/c | Dr. | 12,600 | |||
To W’s Capital A/c
|
21,600 | ||||
(W’s share of Profit till retirement shared by X, Y and Z in 1 : 4 :7) | |||||
X’s Capital A/c | Dr. | 5,000 | |||
Y’s Capital A/c | Dr. | 20,000 | |||
Z’s Capital A/c | Dr. | 35,000 | |||
To W’s Capital A/c
|
60,000 | ||||
(W’s share of goodwill adjusted through remaining partners capital accounts) | |||||
General Reserve A/c | Dr. | 50,000 | |||
To W’s Capital A/c
|
20,000 | ||||
To X’s Capital A/c
|
15,000 | ||||
To Y’s Capital A/c
|
10,000 | ||||
To Z’s Capital A/c
|
5,000 | ||||
(General reserve transferred to capital) | |||||
W’s Capital A/c | Dr. | 9,01,600 | |||
To W’s Loan A/c
|
9,01,600 | ||||
(Balance transferred to Loan A/c) | |||||
X’s Capital A/c | Dr. | 2,08,200 | |||
To Bank A/c
|
2,08,200 | ||||
(Amount withdrawn) | |||||
Bank A/c | Dr. | 2,59,800 | |||
To Y’s Capital A/c
|
17,200 | ||||
To Z’s Capital A/c
|
2,42,600 | ||||
(Amount invested in the business) | |||||
Partners’ Capital Accounts | |||||||||||
Dr. | Cr. | ||||||||||
Particulars | W | X | Y | Z | Particulars | W | X | Y | Z | ||
W’s Capital A/c | − | 6,800 | 27,200 | 47,600 | Balance b/d | 8,00,000 | 6,00,000 | 4,00,000 | 2,00,000 | ||
W’s Loan A/c | 9,01,600 | − | − | − | General Reserve A/c | 20,000 | 15,000 | 10,000 | 5,000 | ||
Bank A/c (Balancing Figure) |
− | 2,08,200 | − | − | X’s Capital A/c | 6,800 | − | − | − | ||
Balance c/d | − | 4,00,000 | 4,00,000 | 4,00,000 | Y’s Capital A/c | 27,200 | − | − | − | ||
Z’s Capital A/c | 47,600 | − | − | − | |||||||
Bank A/c (Balancing Figure) |
− | 17,200 | 2,42,600 | ||||||||
9,01,600 | 6,15,000 | 4,27,200 | 4,47,600 | 9,01,600 | 6,15,000 | 4,27,200 | 4,47,600 | ||||
Working Notes:
WN 1: Calculation of Profit till Retirement
WN 2: Calculation of Gaining Ratio
W : X : Y : Z = 4 : 3 : 2 : 1 (Old)
X : Y : Z = 1 : 1 : 1 (New)
WN 3: Calculation of Goodwill
Answer:
Revaluation Account | |||
Particulars | Amount (Rs) | Particulars | Amount (Rs) |
Plant A/c | 14,000 | Stock A/c | 10,000 |
Motor Car A/c | 4,000 | Building A/c | 18,000 |
Liability for Gratuity A/c | 20,000 | Provision for Doubtful Debts A/c | 10,000 |
38,000 | 38,000 | ||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | X | Y | Z | Particulars | X | Y | Z | ||
Y’s Capital A/c | 12,000 | − | 9,000 | Balance b/d | 1,60,000 | 1,20,000 | 1,00,000 | ||
Y’s Loan A/c | − | 1,56,000 | − | Reserve A/c | 20,000 | 15,000 | 15,000 | ||
Balance c/d | 1,68,000 | − | 1,06,000 | X’s Capital A/c | − | 12,000 | − | ||
Z’s Capital A/c | − | 9,000 | − | ||||||
1,80,000 | 1,56,000 | 1,15,000 | 1,80,000 | 1,56,000 | 1,15,000 | ||||
Balance Sheet
as on April 01, 2015
|
||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | |
Capital A/cs: | Building (1,80,000 + 18,000) | 1,98,000 | ||
X
|
1,68,000 | Plant (1,40,000 – 14,000) | 1,26,000 | |
Z
|
1,06,000 | 2,74,000 | Debtors | 70,000 |
Creditors | 80,000 | Motor Car (40,000 – 4,000) | 36,000 | |
Y’s Loan | 1,56,000 | Bank | 10,000 | |
Bills Payable | 20,000 | Stock (1,00,000 + 10,000) | 1,10,000 | |
Liability for Gratuity | 20,000 | |||
5,50,000 | 5,50,000 | |||
Y’s Loan Account | ||||||
Dr. | Cr. | |||||
Date | Particulars | Amount (Rs) |
Date | Particulars | Amount (Rs) | |
2016 | 2015 | |||||
March 31 | Balance c/d | 1,71,600 | April 01 | Y’s Capital A/c | 1,56,000 | |
2016 | ||||||
March 31 | Interest A/c | 15,600 | ||||
1,71,600 | 1,71,600 | |||||
2016 | 2016 | |||||
April 01 | Bank A/c (52,000 + 15,600) |
67,600 | April 01 | Balance b/d | 1,71,600 | |
2017 | 2017 | |||||
March 31 | Balance c/d | 1,14,400 | March 31 | Interest A/c | 10,400 | |
1,82,000 | 1,82,000 | |||||
Working Notes: Calculation of Gaining Ratio
Page No 6.96:
Question 40:
Revaluation Account | |||
Particulars | Amount (Rs) | Particulars | Amount (Rs) |
Plant A/c | 14,000 | Stock A/c | 10,000 |
Motor Car A/c | 4,000 | Building A/c | 18,000 |
Liability for Gratuity A/c | 20,000 | Provision for Doubtful Debts A/c | 10,000 |
38,000 | 38,000 | ||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | X | Y | Z | Particulars | X | Y | Z | ||
Y’s Capital A/c | 12,000 | − | 9,000 | Balance b/d | 1,60,000 | 1,20,000 | 1,00,000 | ||
Y’s Loan A/c | − | 1,56,000 | − | Reserve A/c | 20,000 | 15,000 | 15,000 | ||
Balance c/d | 1,68,000 | − | 1,06,000 | X’s Capital A/c | − | 12,000 | − | ||
Z’s Capital A/c | − | 9,000 | − | ||||||
1,80,000 | 1,56,000 | 1,15,000 | 1,80,000 | 1,56,000 | 1,15,000 | ||||
Balance Sheet
as on April 01, 2015
|
||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | |
Capital A/cs: | Building (1,80,000 + 18,000) | 1,98,000 | ||
X
|
1,68,000 | Plant (1,40,000 – 14,000) | 1,26,000 | |
Z
|
1,06,000 | 2,74,000 | Debtors | 70,000 |
Creditors | 80,000 | Motor Car (40,000 – 4,000) | 36,000 | |
Y’s Loan | 1,56,000 | Bank | 10,000 | |
Bills Payable | 20,000 | Stock (1,00,000 + 10,000) | 1,10,000 | |
Liability for Gratuity | 20,000 | |||
5,50,000 | 5,50,000 | |||
Y’s Loan Account | ||||||
Dr. | Cr. | |||||
Date | Particulars | Amount (Rs) |
Date | Particulars | Amount (Rs) | |
2016 | 2015 | |||||
March 31 | Balance c/d | 1,71,600 | April 01 | Y’s Capital A/c | 1,56,000 | |
2016 | ||||||
March 31 | Interest A/c | 15,600 | ||||
1,71,600 | 1,71,600 | |||||
2016 | 2016 | |||||
April 01 | Bank A/c (52,000 + 15,600) |
67,600 | April 01 | Balance b/d | 1,71,600 | |
2017 | 2017 | |||||
March 31 | Balance c/d | 1,14,400 | March 31 | Interest A/c | 10,400 | |
1,82,000 | 1,82,000 | |||||
Working Notes: Calculation of Gaining Ratio
Answer:
Revaluation Account | ||||
Particulars | Amount (Rs) | Particulars | Amount (Rs) | |
Machinery A/c | 60,000 | Land & Building A/c | 60,000 | |
Bad Debts A/c (17,000 – 10,000) | 7,000 | Loss transferred to: | ||
Aruna’s Capital A/c
|
2,000 | |||
Karuna’s Capital A/c
|
3,000 | |||
Varuna’s Capital A/c
|
2,000 | 7,000 | ||
67,000 | 67,000 | |||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | Aruna | Karuna | Varuna | Particulars | Aruna | Karuna | Varuna | ||
Revaluation A/c | 2,000 | 3,000 | 2,000 | Balance b/d | 2,00,000 | 3,00,000 | 2,00,000 | ||
Aruna’s Capital A/c | − | 20,000 | 20,000 | General Reserve A/c | 10,000 | 15,000 | 10,000 | ||
Bank A/c | 50,000 | − | − | Workmen Compensation Fund A/c | 2,000 | 3,000 | 2,000 | ||
Aruna’s Loan A/c | 2,00,000 | − | − | Karuna’s Capital A/c | 20,000 | − | − | ||
Balance c/d | − | 4,00,000 | 3,00,000 | Varuna’s Capital A/c | 20,000 | − | − | ||
Bank A/c (Balancing Figure) |
1,05,000 | 1,10,000 | |||||||
2,52,000 | 4,23,000 | 3,22,000 | 2,52,000 | 4,23,000 | 3,22,000 | ||||
Bank Account | |||
Particulars | Amount (Rs) | Amount (Rs) | |
Balance b/d | 1,00,000 | Aruna’s Capital A/c | 50,000 |
Karuna’s Capital | 1,05,000 | Balance c/d | 2,65,000 |
Varuna’s Capital | 1,10,000 | ||
3,15,000 | 3,15,000 | ||
Balance Sheet
as on March 31, 2015
|
|||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | ||
Capital A/cs: | Land & Building | 2,60,000 | |||
Karuna
|
4,00,000 | Machinery | 2,40,000 | ||
Varuna
|
3,00,000 | 7,00,000 | Debtors | 1,10,000 | |
Aruna’s Loan | 2,00,000 |
Less: Bad Debts
|
17,000 | 93,000 | |
Workmen Compensation Fund | 8,000 | Stock | 1,00,000 | ||
Creditors | 50,000 | Bank | 2,65,000 | ||
9,58,000 | 9,58,000 | ||||
Working Notes:
WN 1: Calculation of Goodwill
WN 2: Calculation of Gaining Ratio
WN 3: Calculation of New Capital
Page No 6.97:
Question 41:
Revaluation Account | ||||
Particulars | Amount (Rs) | Particulars | Amount (Rs) | |
Machinery A/c | 60,000 | Land & Building A/c | 60,000 | |
Bad Debts A/c (17,000 – 10,000) | 7,000 | Loss transferred to: | ||
Aruna’s Capital A/c
|
2,000 | |||
Karuna’s Capital A/c
|
3,000 | |||
Varuna’s Capital A/c
|
2,000 | 7,000 | ||
67,000 | 67,000 | |||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | Aruna | Karuna | Varuna | Particulars | Aruna | Karuna | Varuna | ||
Revaluation A/c | 2,000 | 3,000 | 2,000 | Balance b/d | 2,00,000 | 3,00,000 | 2,00,000 | ||
Aruna’s Capital A/c | − | 20,000 | 20,000 | General Reserve A/c | 10,000 | 15,000 | 10,000 | ||
Bank A/c | 50,000 | − | − | Workmen Compensation Fund A/c | 2,000 | 3,000 | 2,000 | ||
Aruna’s Loan A/c | 2,00,000 | − | − | Karuna’s Capital A/c | 20,000 | − | − | ||
Balance c/d | − | 4,00,000 | 3,00,000 | Varuna’s Capital A/c | 20,000 | − | − | ||
Bank A/c (Balancing Figure) |
1,05,000 | 1,10,000 | |||||||
2,52,000 | 4,23,000 | 3,22,000 | 2,52,000 | 4,23,000 | 3,22,000 | ||||
Bank Account | |||
Particulars | Amount (Rs) | Amount (Rs) | |
Balance b/d | 1,00,000 | Aruna’s Capital A/c | 50,000 |
Karuna’s Capital | 1,05,000 | Balance c/d | 2,65,000 |
Varuna’s Capital | 1,10,000 | ||
3,15,000 | 3,15,000 | ||
Balance Sheet
as on March 31, 2015
|
|||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | ||
Capital A/cs: | Land & Building | 2,60,000 | |||
Karuna
|
4,00,000 | Machinery | 2,40,000 | ||
Varuna
|
3,00,000 | 7,00,000 | Debtors | 1,10,000 | |
Aruna’s Loan | 2,00,000 |
Less: Bad Debts
|
17,000 | 93,000 | |
Workmen Compensation Fund | 8,000 | Stock | 1,00,000 | ||
Creditors | 50,000 | Bank | 2,65,000 | ||
9,58,000 | 9,58,000 | ||||
Working Notes:
WN 1: Calculation of Goodwill
WN 2: Calculation of Gaining Ratio
WN 3: Calculation of New Capital
Answer:
Revaluation Account |
||||||
Dr. |
|
Cr. |
||||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|||
Stock |
5,000 |
Fixed Assets |
25,000 |
|||
Profit transferred to: |
|
|
|
|||
X’s Capital A/c |
10,000 |
|
|
|
||
Y’s Capital A/c |
6,000 |
|
|
|
||
Z’s Capital A/c |
4,000 |
20,000 |
|
|
||
|
25,000 |
|
25,000 |
|||
|
|
|
|
|||
Partners’ Capital Accounts |
||||||||
Dr. |
|
Cr. |
||||||
Particulars |
X |
Y |
Z |
Particulars |
X |
Y |
Z |
|
Y’s Capital A/c |
11,000 |
|
22,000 |
Balance b/d |
1,00,000 |
50,000 |
40,000 |
|
Advertisement Expenditure A/c |
2,500 |
1,500 |
1,000 |
Revaluation A/c |
10,000 |
6,000 |
4,000 |
|
Goodwill A/c |
7,500 |
4,500 |
3,000 |
General Reserve |
10,000 |
6,000 |
4,000 |
|
Bank A/c |
|
89,000 |
|
X’s Capital A/c |
|
11,000 |
|
|
Balance c/d (WN3) |
1,20,000 |
|
80,000 |
Z’s Capital A/c |
|
22,000 |
|
|
|
|
|
|
Bank A/c (Bal. Fig.) |
21,000 |
|
58,000 |
|
|
1,41,000 |
95,000 |
1,06,000 |
|
1,41,000 |
95,000 |
1,06,000 |
|
|
|
|
|
|
|
|
|
|
Balance Sheet as at April 01, 2016 |
|||||
Liabilities |
Amount Rs |
Assets |
Amount Rs |
||
Capital A/cs: |
|
|
|
||
X |
1,20,000 |
|
Fixed Assets |
1,15,000 |
|
Z |
80,000 |
2,00,000 |
Add: Undervaluation |
25,000 |
1,40,000 |
Employees’ Provident Fund |
3,500 |
Stock |
55,000 |
|
|
Sundry Creditors |
26,500 |
Less: Overvaluation |
5,000 |
50,000 |
|
|
|
Sundry Debtors |
|
30,000 |
|
|
|
Bank |
10,000 |
||
|
2,30,000 |
|
2,30,000 |
||
|
|
|
|
Working Notes:
WN 1: Calculation of sacrificing/gaining ratio
WN 2: Calculation of goodwill
WN 3: Calculation of New Capital of X and Y
Page No 6.97:
Question 42:
Revaluation Account |
||||||
Dr. |
|
Cr. |
||||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|||
Stock |
5,000 |
Fixed Assets |
25,000 |
|||
Profit transferred to: |
|
|
|
|||
X’s Capital A/c |
10,000 |
|
|
|
||
Y’s Capital A/c |
6,000 |
|
|
|
||
Z’s Capital A/c |
4,000 |
20,000 |
|
|
||
|
25,000 |
|
25,000 |
|||
|
|
|
|
|||
Partners’ Capital Accounts |
||||||||
Dr. |
|
Cr. |
||||||
Particulars |
X |
Y |
Z |
Particulars |
X |
Y |
Z |
|
Y’s Capital A/c |
11,000 |
|
22,000 |
Balance b/d |
1,00,000 |
50,000 |
40,000 |
|
Advertisement Expenditure A/c |
2,500 |
1,500 |
1,000 |
Revaluation A/c |
10,000 |
6,000 |
4,000 |
|
Goodwill A/c |
7,500 |
4,500 |
3,000 |
General Reserve |
10,000 |
6,000 |
4,000 |
|
Bank A/c |
|
89,000 |
|
X’s Capital A/c |
|
11,000 |
|
|
Balance c/d (WN3) |
1,20,000 |
|
80,000 |
Z’s Capital A/c |
|
22,000 |
|
|
|
|
|
|
Bank A/c (Bal. Fig.) |
21,000 |
|
58,000 |
|
|
1,41,000 |
95,000 |
1,06,000 |
|
1,41,000 |
95,000 |
1,06,000 |
|
|
|
|
|
|
|
|
|
|
Balance Sheet as at April 01, 2016 |
|||||
Liabilities |
Amount Rs |
Assets |
Amount Rs |
||
Capital A/cs: |
|
|
|
||
X |
1,20,000 |
|
Fixed Assets |
1,15,000 |
|
Z |
80,000 |
2,00,000 |
Add: Undervaluation |
25,000 |
1,40,000 |
Employees’ Provident Fund |
3,500 |
Stock |
55,000 |
|
|
Sundry Creditors |
26,500 |
Less: Overvaluation |
5,000 |
50,000 |
|
|
|
Sundry Debtors |
|
30,000 |
|
|
|
Bank |
10,000 |
||
|
2,30,000 |
|
2,30,000 |
||
|
|
|
|
Working Notes:
WN 1: Calculation of sacrificing/gaining ratio
WN 2: Calculation of goodwill
WN 3: Calculation of New Capital of X and Y
Answer:
Journal | ||||||
Date | Particulars | L.F. | Debit Amount Rs |
Credit Amount Rs |
||
Profit and Loss Suspense A/c | Dr. | 1,025 | ||||
To X’s Capital A/c | 1,025 | |||||
(X’s share of profit till his death credited to his account) |
Working Notes: Calculation of X’s Share of Profit
Page No 6.97:
Question 43:
Journal | ||||||
Date | Particulars | L.F. | Debit Amount Rs |
Credit Amount Rs |
||
Profit and Loss Suspense A/c | Dr. | 1,025 | ||||
To X’s Capital A/c | 1,025 | |||||
(X’s share of profit till his death credited to his account) |
Working Notes: Calculation of X’s Share of Profit
Answer:
Sales for the year 2013-14 = Rs 7,50,000
Sales from April 01, 2014 to June 30, 2014 = Rs 2,50,000
Profit for the year 2013-14 = Rs 75,000
Page No 6.97:
Question 44:
Sales for the year 2013-14 = Rs 7,50,000
Sales from April 01, 2014 to June 30, 2014 = Rs 2,50,000
Profit for the year 2013-14 = Rs 75,000
Answer:
Journal | ||||||
Date | Particulars | L.F. | Debit Amount Rs |
Credit Amount Rs |
||
P’s Capital A/c | Dr. | 12,000 | ||||
S’s Capital A/c | Dr. | 33,000 | ||||
To R’s Capital A/c
|
45,000 | |||||
(R’s share of goodwill credited to his account and debited to P and S in their gaining ratio) |
Working Notes:
Total Profit of last 4 Years’ = 1,20,000 + 60,000 – 20,000 + 80,000 = Rs 2,40,000
Gaining Ratio = New Ratio – Old Ratio
Old Ratio = 4 : 3 : 1
New Ratio = 3 : 2
Gaining Ratio = 4 : 11
Page No 6.98:
Question 45:
Journal | ||||||
Date | Particulars | L.F. | Debit Amount Rs |
Credit Amount Rs |
||
P’s Capital A/c | Dr. | 12,000 | ||||
S’s Capital A/c | Dr. | 33,000 | ||||
To R’s Capital A/c
|
45,000 | |||||
(R’s share of goodwill credited to his account and debited to P and S in their gaining ratio) |
Working Notes:
Total Profit of last 4 Years’ = 1,20,000 + 60,000 – 20,000 + 80,000 = Rs 2,40,000
Gaining Ratio = New Ratio – Old Ratio
Old Ratio = 4 : 3 : 1
New Ratio = 3 : 2
Gaining Ratio = 4 : 11
Answer:
Journal | |||||
Date | Particulars | L.F. | Debit Amount Rs |
Credit Amount Rs |
|
X’s Capital A/c | Dr. | 24,000 | |||
Z’s Capital A//c | Dr. | 66,000 | |||
To Y’s Capital A/c
|
90,000 | ||||
(Y’s share of goodwill credited to his account and debited to X and Z in their gaining ratio.) |
Working Notes:
Gaining Ratio = New Ratio – Old Ratio
Old Ratio = 4 : 3 : 1
New Ratio = 3 : 2
Gaining Ratio = 4 : 11
Total Profit = 3,00,000 + 1,10,000 – 90,000 + 1,60,000 = Rs 4,80,000
Goodwill = Average Profit × 2 years of purchase
Goodwill = 1,20,000 × 2 =Rs 2,40,000
Page No 6.98:
Question 46:
Journal | |||||
Date | Particulars | L.F. | Debit Amount Rs |
Credit Amount Rs |
|
X’s Capital A/c | Dr. | 24,000 | |||
Z’s Capital A//c | Dr. | 66,000 | |||
To Y’s Capital A/c
|
90,000 | ||||
(Y’s share of goodwill credited to his account and debited to X and Z in their gaining ratio.) |
Working Notes:
Gaining Ratio = New Ratio – Old Ratio
Old Ratio = 4 : 3 : 1
New Ratio = 3 : 2
Gaining Ratio = 4 : 11
Total Profit = 3,00,000 + 1,10,000 – 90,000 + 1,60,000 = Rs 4,80,000
Goodwill = Average Profit × 2 years of purchase
Goodwill = 1,20,000 × 2 =Rs 2,40,000
Answer:
Case 1
Journal | |||||
Date | Particulars | L.F. | Debit Amount Rs |
Credit Amount Rs |
|
X’s Capital A/c | Dr. | 36,000 | |||
Z’s Capital A/c | Dr. | 9,000 | |||
To Y’s Capital A/c
|
45,000 | ||||
(Y’s share of goodwill credited to his account and debited to X and Z in their gaining ratio.) |
Working Notes
Total Profit = 80,000 – 20,000 + 20,000 + 1,60,000 = Rs 2,40,000
Goodwill = 60,000 × 2 = Rs 1,20,000
Case 2
Journal | ||||||
Date | Particulars | L.F. | Debit Amount Rs |
Credit Amount Rs |
||
X’s Capital A/c | Dr. | 36,000 | ||||
Z’s Capital A/c | Dr. | 9,000 | ||||
To Y’s Capital A/c
|
45,000 | |||||
(Y’s share of goodwill credited to his account and debited to X and Z in their gaining ratio) |
Working Notes
Total Profit for Last 4 Years’ = Rs 2,40,000
Y’s Share of Goodwill =
Case 3
Journal | ||||||
Date | Particulars | L.F. | Debit Amount Rs |
Credit Amount Rs |
||
X’s Capital A/c | Dr. | 36,000 | ||||
Z’s Capital A/c | Dr. | 9,000 | ||||
To Y’s Capital A/c
|
45,000 | |||||
(Y’s share of goodwill credited to his account and debited to X and Z in their gaining ratio.) |
Working Notes
Goodwill = Average Profit for 3 years × 3 years of purchase
Date of death is 30thSeptember 2012
Profit is calculated as below:
1 Oct 2011 – 30 Sept 2012 = 50% of 80,000 + 50,000 = Rs 90,000
1 Oct 2010 – 30 Sept 2011 = 50% of 80,000 – 50% of 20,000 = Rs 30,000
1 Oct 2009 – 30 Sept 2010 = 50% of 20,000 – 50% of 20,000 = NIL
Total Profit = 90,000 + 30,000 =Rs. 1,20,000
Goodwill = 40,000 × 3 = Rs 1,20,000
Note: Since no information about new ratio is given, it is assumed that partner’s will gain in their old ratio which is 4 : 1.
Page No 6.98:
Question 47:
Case 1
Journal | |||||
Date | Particulars | L.F. | Debit Amount Rs |
Credit Amount Rs |
|
X’s Capital A/c | Dr. | 36,000 | |||
Z’s Capital A/c | Dr. | 9,000 | |||
To Y’s Capital A/c
|
45,000 | ||||
(Y’s share of goodwill credited to his account and debited to X and Z in their gaining ratio.) |
Working Notes
Total Profit = 80,000 – 20,000 + 20,000 + 1,60,000 = Rs 2,40,000
Goodwill = 60,000 × 2 = Rs 1,20,000
Case 2
Journal | ||||||
Date | Particulars | L.F. | Debit Amount Rs |
Credit Amount Rs |
||
X’s Capital A/c | Dr. | 36,000 | ||||
Z’s Capital A/c | Dr. | 9,000 | ||||
To Y’s Capital A/c
|
45,000 | |||||
(Y’s share of goodwill credited to his account and debited to X and Z in their gaining ratio) |
Working Notes
Total Profit for Last 4 Years’ = Rs 2,40,000
Y’s Share of Goodwill =
Case 3
Journal | ||||||
Date | Particulars | L.F. | Debit Amount Rs |
Credit Amount Rs |
||
X’s Capital A/c | Dr. | 36,000 | ||||
Z’s Capital A/c | Dr. | 9,000 | ||||
To Y’s Capital A/c
|
45,000 | |||||
(Y’s share of goodwill credited to his account and debited to X and Z in their gaining ratio.) |
Working Notes
Goodwill = Average Profit for 3 years × 3 years of purchase
Date of death is 30thSeptember 2012
Profit is calculated as below:
1 Oct 2011 – 30 Sept 2012 = 50% of 80,000 + 50,000 = Rs 90,000
1 Oct 2010 – 30 Sept 2011 = 50% of 80,000 – 50% of 20,000 = Rs 30,000
1 Oct 2009 – 30 Sept 2010 = 50% of 20,000 – 50% of 20,000 = NIL
Total Profit = 90,000 + 30,000 =Rs. 1,20,000
Goodwill = 40,000 × 3 = Rs 1,20,000
Note: Since no information about new ratio is given, it is assumed that partner’s will gain in their old ratio which is 4 : 1.
Answer:
A’s Capital Account |
|||
Dr. |
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
Drawings A/c |
1,500 |
Balance b/d |
10,000 |
|
|
B’s Capital A/c (Goodwill) |
6,570 |
A’s Executor’s A/c |
24160.83 |
C’s Capital A/c (Goodwill) |
6,570 |
|
|
Profit and Loss Suspense A/c |
2520.83 |
|
25660.83 |
|
25660.83 |
|
|
|
|
Working Notes:
WN 1 Calculation of Goodwill
∴ Goodwill = 13,140 × 2 = Rs 26,280
WN 2 Adjustment of Goodwill
Old Ratio (A, B and C) = 4 : 2 : 2
A died.
∴ New Ratio = 2 : 2 or 1 : 1 and
Gaining Ratio = 2 : 2 or 1 : 1
A’s Share of Goodwill
This share of goodwill is to be distributed between B and C in their gaining ratio (i.e. 1: 1)
WN 3 Calculation of A’s Share of Profit
A’s Profit Share = Average Profit for last 3 previous years + 10% of Average Profit (for 5 months)
Average profit for last 3 years
10% of Average Profit = 11,000 × 10% = Rs 1,100
∴ A’s Profit Share = Average Profit + 10% of Average Profit
Page No 6.98:
Question 48:
A’s Capital Account |
|||
Dr. |
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
Drawings A/c |
1,500 |
Balance b/d |
10,000 |
|
|
B’s Capital A/c (Goodwill) |
6,570 |
A’s Executor’s A/c |
24160.83 |
C’s Capital A/c (Goodwill) |
6,570 |
|
|
Profit and Loss Suspense A/c |
2520.83 |
|
25660.83 |
|
25660.83 |
|
|
|
|
Working Notes:
WN 1 Calculation of Goodwill
∴ Goodwill = 13,140 × 2 = Rs 26,280
WN 2 Adjustment of Goodwill
Old Ratio (A, B and C) = 4 : 2 : 2
A died.
∴ New Ratio = 2 : 2 or 1 : 1 and
Gaining Ratio = 2 : 2 or 1 : 1
A’s Share of Goodwill
This share of goodwill is to be distributed between B and C in their gaining ratio (i.e. 1: 1)
WN 3 Calculation of A’s Share of Profit
A’s Profit Share = Average Profit for last 3 previous years + 10% of Average Profit (for 5 months)
Average profit for last 3 years
10% of Average Profit = 11,000 × 10% = Rs 1,100
∴ A’s Profit Share = Average Profit + 10% of Average Profit
Answer:
Revaluation Account | ||||||
Dr. | Cr. | |||||
Particulars | Amount Rs | Particulars | Amount Rs | |||
Furniture A/c | 3,000 | Machinery A/c | 6,500 | |||
Stock A/c | 2,000 | |||||
Profit transferred to: | ||||||
X’s Capital A/c
|
500 | |||||
Y’s Capital A/c
|
500 | |||||
Z’s Capital A/c
|
500 | 1,500 | ||||
6,500 | 6,500 | |||||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | X | Y | Z | Particulars | X | Y | Z | ||
Z’s Capital A/c | 7,500 | 7,500 | Balance b/d | 50,000 | 50,000 | 50,000 | |||
Z’s Executor A/c | 70,500 | General Reserve A/c | 5,000 | 5,000 | 5,000 | ||||
Balance c/d | 48,000 | 48,000 | Revaluation A/c | 500 | 500 | 500 | |||
X’s Capital A/c | 7,500 | ||||||||
Y’s Capital A/c | 7,500 | ||||||||
55,500 | 55,500 | 70,500 | 55,500 | 55,500 | 70,500 | ||||
Balance Sheet
as on April 01, 2016 after Z’s death
|
|||||
Liabilities | Amount Rs |
Assets | Amount Rs | ||
Machinery | 56,500 | ||||
Capital A/cs: | Furniture | 25,000 | |||
X
|
48,000 | Bills Receivable | 21,000 | ||
Y
|
48,000 | 96,000 | Debtors | 45,000 | |
Creditors | 500 |
Less: Provision for Doubtful Debts
|
3,000 | 42,000 | |
Z’s Executor | 60,500 | Stock | 7,500 | ||
(70,500 – 10,000) | Cash at Bank (15,000 – 10,000) | 5,000 | |||
1,57,000 | 1,57,000 | ||||
Working Notes:
Goodwill = Rs 45,000
Z’s Share =
Since no information about new ratio is given, it is assumed that partner’s will gain in their old ratio which is 1 : 1.
Page No 6.99:
Question 49:
Revaluation Account | ||||||
Dr. | Cr. | |||||
Particulars | Amount Rs | Particulars | Amount Rs | |||
Furniture A/c | 3,000 | Machinery A/c | 6,500 | |||
Stock A/c | 2,000 | |||||
Profit transferred to: | ||||||
X’s Capital A/c
|
500 | |||||
Y’s Capital A/c
|
500 | |||||
Z’s Capital A/c
|
500 | 1,500 | ||||
6,500 | 6,500 | |||||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | X | Y | Z | Particulars | X | Y | Z | ||
Z’s Capital A/c | 7,500 | 7,500 | Balance b/d | 50,000 | 50,000 | 50,000 | |||
Z’s Executor A/c | 70,500 | General Reserve A/c | 5,000 | 5,000 | 5,000 | ||||
Balance c/d | 48,000 | 48,000 | Revaluation A/c | 500 | 500 | 500 | |||
X’s Capital A/c | 7,500 | ||||||||
Y’s Capital A/c | 7,500 | ||||||||
55,500 | 55,500 | 70,500 | 55,500 | 55,500 | 70,500 | ||||
Balance Sheet
as on April 01, 2016 after Z’s death
|
|||||
Liabilities | Amount Rs |
Assets | Amount Rs | ||
Machinery | 56,500 | ||||
Capital A/cs: | Furniture | 25,000 | |||
X
|
48,000 | Bills Receivable | 21,000 | ||
Y
|
48,000 | 96,000 | Debtors | 45,000 | |
Creditors | 500 |
Less: Provision for Doubtful Debts
|
3,000 | 42,000 | |
Z’s Executor | 60,500 | Stock | 7,500 | ||
(70,500 – 10,000) | Cash at Bank (15,000 – 10,000) | 5,000 | |||
1,57,000 | 1,57,000 | ||||
Working Notes:
Goodwill = Rs 45,000
Z’s Share =
Since no information about new ratio is given, it is assumed that partner’s will gain in their old ratio which is 1 : 1.
Answer:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
General Reserve A/c |
Dr. |
|
45,000 |
|
To Akhil’s Capital A/c |
|
|
15,000 |
|
To Nikhil’s Capital A/c |
|
|
15,000 |
|
To Sunil’s Capital A/c |
|
|
15,000 |
|
(General Reserve distributed among partners in their old ratio) |
|
|
|
|
|
|
|
|
|
Akhil’s Capital A/c |
Dr. |
|
35,000 |
|
Nikhil’s Capital A/c |
Dr. |
|
35,000 |
|
To Sunil’s Capital A/c |
|
|
70,000 |
|
(Sunil’s share of goodwill adjusted) |
|
|
|
|
|
|
|
|
|
Interest on Capital A/c |
Dr. |
|
1,600 |
|
To Sunil’s Capital A/c |
|
|
1,600 |
|
(Interest allowed on Sunil’s Capital) |
|
|
|
|
|
|
|
|
|
Profit and Loss Suspense A/c |
Dr. |
|
20,000 |
|
To Sunil’s Capital A/c |
|
|
20,000 |
|
(Sunil’s profit share transferred to his capital account) |
|
|
|
|
|
|
|
|
|
Sunil’s Capital A/c |
Dr. |
|
1,86,600 |
|
To Sunil’s Executor’s A/c |
|
|
1,86,600 |
|
(Amount due to Sunil after all adjustments transferred to his Executor’s Account) |
|
|
|
|
|
|
|
|
|
Sunil’s Executor’s A/c |
Dr. |
|
50,000 |
|
To Bank A/c |
|
|
50,000 |
|
(Amount paid to Sunil’s Executor) |
|
|
|
|
|
|
|
|
Sunil’s Capital Account |
|||
Dr. |
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
|
Balance b/d |
80,000 |
|
|
Interest on Capital A/c |
1,600 |
|
|
General Reserve |
15,000 |
|
|
Profit and Loss Suspense A/c |
20,000 |
|
|
Akhil’s Capital A/c (Goodwill) |
35,000 |
Sunil’s Executor’s A/c |
1,86,600 |
Nikhil’s Capital A/c (Goodwill) |
35,000 |
|
1,86,600 |
|
1,86,600 |
|
|
|
|
Sunil’s Executor’s Account |
|||
Dr. |
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
Bank A/c |
50,000 |
Sunil’s Capital A/c |
1,86,600 |
Balance c/d |
1,36,600 |
|
|
|
1,86,600 |
|
1,86,600 |
|
|
|
|
Working Notes:
WN 1 Calculation of Sunil’s Share of Profit
Profit for 2015-16 = Rs 1,80,000
WN 2 Calculation of Goodwill
Goodwill = Average Profit × Number of Year’s Purchase
∴ Goodwill = Average Profit × Number of Years’ Purchase
= 70,000 × 3 = Rs 2,10,000
WN 3 Adjustment of Goodwill
Old Ratio = 1 : 1 : 1
Sunil died.
∴ New Ratio = 1 : 1 and
Gaining Ratio = 1 : 1
Sunil’s Share in Goodwill =
This share of goodwill is to be distributed between Akhil and Nikhil in their gaining ratio (i.e. 1 : 1).
WN 4 Calculation of Interest on Sunil’s Capital
Sunil’s Capital Balance = Rs 80,000
∴ Interest on Capital (for 4 months)
Page No 6.99:
Question 50:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
General Reserve A/c |
Dr. |
|
45,000 |
|
To Akhil’s Capital A/c |
|
|
15,000 |
|
To Nikhil’s Capital A/c |
|
|
15,000 |
|
To Sunil’s Capital A/c |
|
|
15,000 |
|
(General Reserve distributed among partners in their old ratio) |
|
|
|
|
|
|
|
|
|
Akhil’s Capital A/c |
Dr. |
|
35,000 |
|
Nikhil’s Capital A/c |
Dr. |
|
35,000 |
|
To Sunil’s Capital A/c |
|
|
70,000 |
|
(Sunil’s share of goodwill adjusted) |
|
|
|
|
|
|
|
|
|
Interest on Capital A/c |
Dr. |
|
1,600 |
|
To Sunil’s Capital A/c |
|
|
1,600 |
|
(Interest allowed on Sunil’s Capital) |
|
|
|
|
|
|
|
|
|
Profit and Loss Suspense A/c |
Dr. |
|
20,000 |
|
To Sunil’s Capital A/c |
|
|
20,000 |
|
(Sunil’s profit share transferred to his capital account) |
|
|
|
|
|
|
|
|
|
Sunil’s Capital A/c |
Dr. |
|
1,86,600 |
|
To Sunil’s Executor’s A/c |
|
|
1,86,600 |
|
(Amount due to Sunil after all adjustments transferred to his Executor’s Account) |
|
|
|
|
|
|
|
|
|
Sunil’s Executor’s A/c |
Dr. |
|
50,000 |
|
To Bank A/c |
|
|
50,000 |
|
(Amount paid to Sunil’s Executor) |
|
|
|
|
|
|
|
|
Sunil’s Capital Account |
|||
Dr. |
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
|
Balance b/d |
80,000 |
|
|
Interest on Capital A/c |
1,600 |
|
|
General Reserve |
15,000 |
|
|
Profit and Loss Suspense A/c |
20,000 |
|
|
Akhil’s Capital A/c (Goodwill) |
35,000 |
Sunil’s Executor’s A/c |
1,86,600 |
Nikhil’s Capital A/c (Goodwill) |
35,000 |
|
1,86,600 |
|
1,86,600 |
|
|
|
|
Sunil’s Executor’s Account |
|||
Dr. |
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
Bank A/c |
50,000 |
Sunil’s Capital A/c |
1,86,600 |
Balance c/d |
1,36,600 |
|
|
|
1,86,600 |
|
1,86,600 |
|
|
|
|
Working Notes:
WN 1 Calculation of Sunil’s Share of Profit
Profit for 2015-16 = Rs 1,80,000
WN 2 Calculation of Goodwill
Goodwill = Average Profit × Number of Year’s Purchase
∴ Goodwill = Average Profit × Number of Years’ Purchase
= 70,000 × 3 = Rs 2,10,000
WN 3 Adjustment of Goodwill
Old Ratio = 1 : 1 : 1
Sunil died.
∴ New Ratio = 1 : 1 and
Gaining Ratio = 1 : 1
Sunil’s Share in Goodwill =
This share of goodwill is to be distributed between Akhil and Nikhil in their gaining ratio (i.e. 1 : 1).
WN 4 Calculation of Interest on Sunil’s Capital
Sunil’s Capital Balance = Rs 80,000
∴ Interest on Capital (for 4 months)
Answer:
Revaluation Account | ||||||
Dr. | Cr. | |||||
Particulars | Amount Rs | Particulars | Amount Rs | |||
Provision for doubtful debts A/c | 1,500 | Building A/c | 15,000 | |||
Stock A/c | 2,000 | |||||
Workmen Compensation Fund | 5,000 | |||||
Profit transferred to: | ||||||
A’s Capital A/c
|
3,250 | |||||
B’s Capital A/c
|
2,167 | |||||
C’s Capital A/c
|
1,083 | 6,500 | ||||
15,000 | 15,000 | |||||
Partners’ Capital Accounts | |||||||||
Dr. | Cr. | ||||||||
Particulars | A | B | C | Particulars | A | B | C | ||
A’s Capital A/c | 8,000 | 4,000 | Balance b/d | 1,50,000 | 1,50,000 | 1,50,000 | |||
A’s Executor A/c | 1,67,375 | Profit & Loss Suspense A/c | 1,375 | ||||||
Balance c/d | 1,44,167 | 1,47,083 | Revaluation A/c | 3,250 | 2,167 | 1,083 | |||
B’s Capital A/c | 8,000 | ||||||||
C’s Capital A/c | 4,000 | ||||||||
Interest on Capital A/c | 750 | ||||||||
1,67,375 | 1,52,167 | 1,51,083 | 1,67,375 | 1,52,167 | 1,51,083 | ||||
Balance Sheet
as on July 01, 2016 after A’s death
|
|||||
Liabilities | Amount Rs | Assets | Amount Rs | ||
A’s Executor | 1,67,375 | Machinery | 25,000 | ||
Capital A/cs: | Building | 85,000 | |||
B
|
1,44,167 | Profit and Loss Suspense A/c (1,375 + 750) | 2,125 | ||
C
|
1,47,083 | 2,91,250 | Debtors | 15,000 | |
Creditors | 17,000 |
Less: Provision for Doubtful Debts
|
1,500 | 13,500 | |
Workmen Compensation Fund | 5,000 | Stock | 30,000 | ||
Bank | 3,25,000 | ||||
4,80,625 | 4,80,625 | ||||
Working Notes:
WN 1: Interest on Capital =
WN 2: Profit to A for 1st April 2016 to 1st July 2016 =
WN 3: Calculation of Goodwill
Total Profit = 11,000 + 15,000 + 10,000 =Rs 36,000
Goodwill = 12,000 × 2 = Rs 24,000
A’s share =
Since no information about new ratio is given, it is assumed that partner’s will gain in their old ratio which is 2 : 1.
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