Question

Kale, Gore and Pandhare were partners in Shyam Traders, Pune sharing Profit and Losses in the ratio 3:3:2. Their Balance Sheet as on 31st March, 2019 is as follows:

Liabilities	Amount (₹)	Assets	Amount (₹)
Capital A/c:		Building	10,000
Kale	11,000	Plant & Machinery	10,700
Gore	15,000	Livestock	10,000
Pandhare	8,000	Debtors	5,000
Creditors	8,900	Stock	6,600
Bills Payable	2,000	Bank	6,600
Reserve Fund	4,000
	48,900		48,900

On 1st April 2019, Mr. Pandhare retired from the firm on the following terms:

1. Assets to be revalued as Stock ₹ 6,300, Plant and Machinery ₹ 10 000 Livestock ₹ 10,200.
2. Goodwill of the firm is to be valued at ₹ 4,000. however only Pandhare's share in it is to be raised in the books and written off immediately.
3. RDD to be maintained at 10% on debtors.
4. ₹ 100 to be written off from Creditors.
5. The amount payable to Mr. Pandhare to be transferred to his Loon Account.

Prepare: Profit and Loss Adjustment Account, Partners Capital Account, Balance Sheet of new firm.

Answer 1

In the Books of Shyam Traders, Pune
Dr.	Profit and Loss Adjustment A/c			Cr.
Particulars	Amount (₹)	Particulars	Amount (₹)	Amount (₹)
To Plant & Machinery A/c	700	By Live Stock A/c		200
To Stock A/c	300	By Creditors A/c		100
To R.D.D	500	By Partners Capital A/c (Loss)
		Kale	450	1,200
		Gore	450
		Pandhare	300
	1,500			1,500

 

Dr.	Partner's Capital Accounts						Cr.
Particulars	Kale (₹)	Gore (₹)	Pandhare (₹)	Particulars	Kale (₹)	Gore (₹)	Pandhare (₹)
To Goodwill A/c.	500	500	-	By Balance b/d	11,000	15,000	8,000
To P & L Adj. A/c (Loss)	450	450	300	By Reserve Fund A/c	1,500	1,500	1,000
To Loan A/c	-	-	9,700	By Goodwill A/c	-	-	1,000
To Balance c/d	11,550	15,550	-
	12,500	16,500	10,000		12,500	16,500	10,000

 

Balance Sheet as on 1st April, 2019
Liabilities	Amount (₹)	Amount (₹)	Assets	Amount (₹)	Amount (₹)
Capital Account:			Building		10,000
Kale	11,550	27,100	Plant & Machinery	10,700	10,000
Gore	15,550		Less: Depreciation	700
Pandhare's Loan A/c		9,700	Live Stock	10,000	10,200
Creditors	8,900	8,800	Add: Appreciation	200
Less: Written off	100		Debtors	5,000	4,500
Bills Payable		2,000	Less: R.D.D.	500
			Stock	6,600	6,300
			Less: Depreciation	300
			Bank		6,600
		47,600			47,600