Question

Minu, Renu, and Sonu share profits and losses equally. Their Balance Sheet as on 31st March, 2021 was as under:

Balance Sheet as on 31st March, 2021
Liabilities	Amount (₹)	Amount (₹)	Assets	Amount (₹)	Amount (₹)
Capital Accounts:			Bank		25,400
Minu		46,600	Debtors	28,000	26,100
Renu		38,000	Less: R.D.D	1,900
Sonu		35,000	Computer		17,500
Creditors		40,900	Building		70,000
General reserve		13,500	Machinery		25,000
			Furniture		10,000
		1,74,000			1,74,000

On 1st April, 2021, Sonu retired from the firm on the following terms:

1. Building to be appreciated by 10%.
2. All debtors are good.
3. Computer to be depreciated by 10%.
4. Machinery be revalued ₹ 22,500 and Furniture is revalued ₹ 9,550.
5. Part payment of ₹ 18,000 was made to Sonu by NEFT and balance was transferred to her loan account.

Prepare:

1. Profit and Loss adjustment Account
2. Partners’ Capital Account
3. Balance Sheet of Minu and Renu

Answer 1

Dr.	Profit and Loss Adjustment Account				Cr.
Particulars	Amount (₹)	Amount (₹)	Particulars	Amount (₹)	Amount (₹)
To Computer A/c		1,750	By R.D.D. A/c		1,900
To Machinery A/c		2,500	By Building A/c		7,000
To Furniture A/c		450
To Partners’ Capital A/c (Profit)		4,200
Minu	1,400
Renu	1,400
Sonu	1,400
		8,900			8,900

 

Dr.	Partners’ Capital Accounts						Cr.
Particulars	Minu (₹)	Renu (₹)	Sonu (₹)	Particulars	Minu (₹)	Renu (₹)	Sonu (₹)
To Bank A/c	−	−	18,000	By Balance b/d	46,600	38,000	35,000
To Sonu’s Loan A/c	−	−	22,900	By General Reserve A/c	4,500	4,500	4,500
To Balance c/d	52,500	43,900	−	By Profit and Loss Adjustment A/c	1,400	1,400	1,400
	52,500	43,900	40,900		52,500	43,900	40,900

 

Balance Sheet as on 1st April, 2021
Liabilities	Amount (₹)	Amount (₹)	Assets	Amount (₹)	Amount (₹)
Capital A/cs:		96,400	Furniture	10,000	9,550
Minu	52,500		Less: Depreciation	450
Renu	43,900		Debtors		28,000
Sonu’s Loan A/c		22,900	Computer	17,500	15,750
Creditors		40,900	Less: Depreciation	1,750
			Building	70,000	77,000
			Add: Appreciation	7,000
			Machinery	25,000	22,500
			Less: Depreciation	2,500
			Bank	25,400	7,400
			Less: Amount paid to Sonu through NEFT	18,000
		1,60,200			1,60,200