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Preparation of Deceased Partner's Capital Account, Executor's Account

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Bora, Singh and Ibrahim were partners in a firm sharing profits in the ratio of 5: 3: 1. On 2-3-2015 their firm was dissolved. The assets were realized and the liabilities were paid off. Given below are the Realisation Account, Partners' Capital Account and Bank Account of the firm. The accountant of the firm left a few amounts unposted in these accounts. You are required to complete these accounts by posting the correct amounts.

Realisation Account
Dr.   Cr.
Particular

Amount

Rs

Particular

Amount

Rs

To Stock 

To Debtors

To Plant and Machinery

To Bank

   Sundry Creditors   16,000

   Bills Payable            3,400

   Mortgage Loan      15,000 

To Bank (Outstanding repairs)

To Bank (Exp.)

 

 

10,000

25,000

40,000

 

 

 

34,400

400

620

 

 

By Provision of bad debts

By Sundry Creditors

By Bills Payables

By Mortgage Loan

By Bank – Assets realized

      Stock                     6,700

      Debtors                12,500

      Plant & Machinery   36,000

By Bank – unrecorded unrecorded assets realized

By ______________________

 

5,000

16,600

3,400

15,000

 

 

 

55,200

6,220

------

 

 

1,10,420

  1,10,420

 

Capital Account
Dr.   Cr.
Particulars

Bora

Rs

Singh

Rs

Ibrahim

Rs

Particulars

Bora

Rs

Singh

Rs

Ibrahim

Rs

-

-

-

-

-

-

-

-

By Balance b/d

By General Reserve

22,000

2,500

18,000

1,500

10,000

500

  24,500 19,500 10,500   24,500 19,500 10,500

 

Bank Account
Particular

Amount

Rs

Particular

Rs

Amount

Rs

To Balance b/d

To Realisation

_______________

 

 

19,500

55,200

-------

 

 

By Realisation (liabilities)

By Realisation (Unrecorded liabilities)

By __________

By __________

 

34,400

400

 

 

 

  80,920   80,920

Ashok, Babu and Chetan were partners in a firm sharing profits in the ratio of 4:3:3. The firm closes its books on 31st March every year. On 31st December 2016, Ashok died. The partnership deed provided that on the death of a partner his executors will be entitled for the following.

1) Balance in his capital account. On 1.4.2016, there was a balance of Rs 90,000 in Ashok’s Capital Account

2) Interest on Capital @12% per annum

3) His share in the profits of the firm in the year of his death will be calculated on the basis of the rate of net profit on sales of the previous year, which was 25%. The sales of the firm till 31st December 2016 were Rs 4, 00,000.

4) His share in the goodwill of the firm. The goodwill of the firm on Ashok’s death was valued at 4,50,000. The partnership deed also provided for the following deduction from the amount payable to the executor of the deceased partner:

  • His drawings in the year of his death, Ashok’s drawings till 31.12.2016 were Rs 15,000.
  • Interest on drawings @12 % per annum which was calculated on Rs 1,500.

The accountant of the firm prepared Ashok’s Capital Account to be presented to the executor of Ashok but in a hurry, he left it incomplete. Ashok’s Capital Account as prepared by the firm accountant is given below.

Ashok Capital Account
Dr. Cr.
Date                        Particulars Rs Date                        Particulars Rs

2016

Dec 31              _________

Dec 31              _________

Dec 31              _________

 

 

 

15,000

______

______

 

 

2016

April 1               _________

Dec 31              _________

Dec 31              _________

Dec 31              _________

Dec 31              _________

 

90,000

8,300

40,000

90,000

90,000

  3,18,100   3,18,100

Your are required to complete Ashok’s Capital Account.

S
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