Question

Naresh, Raj Kumar and Bishwajeet are equal partners. Raj Kumar decides to retire. On the date of his retirement, the Balance Sheet of the firm showed the following: General Reserves Rs 36,000 and Profit and Loss Account (Dr.) Rs 15,000.
Pass the necessary journal entries to the above effect.

Answer 1

 Books of Naresh and Bishwajeet
Journal Entries

Date	Particulars	L.F.	Amt (Rs.)	Amt (Rs.)
	General Reserve A/c           Dr.     To Naresh’s Capital A/c     To Raj Kumar’s Capital A/c     To Bishwajeet’s Capital A/c (General Reserve distributed among old partner in old ratio)		36,000	12,000 12,000 12,000
	Naresh’s Capital A/c           Dr. Raj Kumar’s Capital A/c      Dr. Bishwajeet’s Capital A/c      Dr.     To Profit and Loss A/c (Debit balance of Profit and Loss Account written off)		5,000 5,000 5,000	15,000