Rani and Geeta Are Partners Sharing Profits and Losses 3:2 Respectively. Their Position on 31st March, 2013 Was as Follows - Book Keeping and Accountancy

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Rani and Geeta are partners sharing profits and losses 3:2 respectively. Their position on 31st March, 2013 was as follows

Balance sheet as on 31st March, 2013.

Liabilities
Amount (Rs.)
Assets
Amount (Rs.)
Amount (Rs.)
Capital Accounts
 
Building
 
100000
Rani
100000
Furniture
 
10000
Geeta
75000
Stock
 
31000
Creditors
10000
Debtors
50000
 
Bills Payable
5000
Less: R.D.D.
-1000
49000
General Reserve
15000
Bank Balance
 
15000
 
205000
   
205000
On 1st April, 2013 hey admitted suvarna on the following terms:

(1) Suvarna should bring in cash Rs. 1,00,000 as capital for 1/5 th share in future profit and Rs. 25,000 as goodwill.

(2) Building should be revalued at Rs. 1,25,000.

(3) Depreciate furniture @ 12.5 % and stock @ 10% p.a.

(4) R.D.D. should be maintained as it is.

(5) The Capital Accounts of partners should be adjusted in their new profit sharing ratio through bank account.

Prepare: Profit and loss adjustment account, capital account and balance sheet of the new firm.
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Solution

In the books of the firm

Profit and Loss Adjustment A/c

Particulars
Amount Rs.
Amount Rs.
Particulars
Amount Rs.
Amount Rs.
To Furniture A/c
 
1250
By Building A/c
 
25000
To Stock A/c
 
3100
     
To Revaluation Profit :
         
Rani Capital A/c
12390
       
Geeta Capital A/c
8260
20650
     
   
25000
   
25000

Partners’ Capital Accounts

Particulars
Rani
Geeta
Suvarna
Particulars
Rani
Geeta
Suvarna
       
By Balance b/d
100000
75000
 
       
By Bank A/c
   
100000
       
By General Reserve A/c
9000
6000
 
       
By Goodwill A/c
15000
10000
 
       
By Profit and Loss Adjustment A/c
12390
8260
 
To Balance C/d
240000
160000
100000
By Bank A/c
103610
60740
 
 
240000
160000
100000
 
240000
160000
100000

Balance Sheet as on 1st April, 2013

Liabilities
Amount
Rs.
Amount
Rs.
Assets
Amount
Rs.
Amount
Rs.
Capital A/c:
   
Building
100000
 
Rani
240000
 
Add: Appreciation
25000
125000
Geeta
160000
 
Furniture
10000
 
Suvarna
100000
500000
Less: Depreciation
1250
8750
Creditors
 
10000
Stock
31000
 
Bills Payable
 
5000
Less: Written off
3100
27900
     
Debtors
50000
 
     
Less: R.D.D.
1000
49000
     
Bank Balance
 
304350
   
515000
   
515000

Working notes :

Suvarna’s share =`1/5`

Therefore, rani’s share = `4/5 xx 3/5 = 12/25`

Geeta’s share = `4/5 xx 2/5 = 8/25`

New ratio = 12 : 8 : 5

New capital = 100000 x 5 = 500000

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RELATED QUESTIONS

Akash and Suraj are partners in a firm sharing profits and losses in the ratio 3 : 2. Their balance sheet as on 31st March, 2013 was as follows:

                       Balance Sheet as on 31st March, 2013

Liabilities Amount (Rs.) Assets Amount (Rs.)

Capital A/c

          Akash

          Suraj

 

50000

50000

Furniture 2100

General Reserve

10000 Stock 28700
Sundry creditors 60000 Land and building 35000
Bills payable 17000 Plant and machinery 49000
    Sundry debtors 63000
    Cash 9200
  187000   187000

They agreed to admit Sanjay in their partnership on 1st April, 2013, on the following terms :

  1. Sanjay should bring Rs. 1,500, as his share of goodwill in the firm, and Rs. 2,000 as his capital.
  2. Reserve for doubtful debts is to be provided @ 5% on debtors.
  3. Land and building be depreciated at 10% p. a.
  4. Plant and machinery to be depreciated @ 5% and stock to be depreciated @ 10% p. a.
  5. The new profit sharing ratio will be 2: 1: 1.

Prepare :

  1. Revaluation Account.
  2. Partners’ Capital Accounts.
  3. New Balance Sheet of the firm.

Given below is the balance sheet of Vaishali, Madhuri and Shobha, who were sharing profits and losses in the ratio of 3 : 3 : 2.

                                                           Balance Sheet as on

                                                             31st March, 2012

Liabilities Amount (Rs.) Assets Amount (Rs.)
Creditors 34800 Cash 21600
Bills Payable 8800 Machinery 34800

Capital A/c

        Vaishali

        Madhuri

        Shobha

 

48000

52000

36000

Debtors 50000
 Reserved Fund 16000 Stock 25200
    Furniture 16000
    Building 48000
  195600   195600

 

On 1st April, 2012 Shobha retired from the firm on the following terms:

1. Assets be revalued as under:

Stock Rs. 24,000, Machinery Rs. 32,000, Furniture Rs. 16,800.

2. R.D.D. be maintained at 4% on debtors.

3. An item of Rs. 400 from creditors is no longer a liability and hence should be properly adjusted.

4. The amount due to Shobha be transferred to her loan account.

Pass necessary Journal Entries in the books of the firm.


The balance sheet of Anand Traders, Wardha is as follows. Partners share profits and losses as 5/10 , 2/10, 3/10.
Balance Sheet as on 31st March, 2013.
Liabilities
Amount
(Rs.)
Assets
 
Amount
(Rs.)
Capital Accounts
 
Plant and machinery
 
32,000
Sunil
36,000
Factory Building
 
40,000
Pankaj
32,000
Stock
 
20,400
Paresh
17,600
Debtors
   16,800
 
Creditors
21,200
Less: R.D.D.
  • 800
16,00
General Reserve
14,000
Cash
 
12,400
 
1,20,800
   
1,20,800
Pankaj retired from the business on 1st April, 2013 on the following terms:
(1) The assets were revalued as under .....
(i) Stock at Rs. 28,000.
(ii) Factory building is appreciated by 10%.
(iii) Reserve for doubtful debts is to be increased up to Rs. 1,000.
(iv) Plant and machinery is to be depreciated by 10%
(2) The goodwill of the retiring partner is to be valued at Rs. 8,000 and the remaining partners decided that goodwill be written back in their new profit sharing ratio which will be 5:3.
(3) Amount due to Pankaj is to be transferred to his loan account.

Prepare :
(a) Profit and Loss adjustment account
(b) Capital account of partners.
(c) Balance sheet of new firm.


Miss Meena and Miss Reena are in partnership sharing profits and losses in the ratio of 3: 2.

From the following trial balance and adjustments, you are required to prepare Trading Account, Profit and Loss Account for the year ended 31st March 2013 and Balance Sheet as on that date.
Trial Balance as on 31.03.2013

Trial Balance as on 31.03.2013
Particulars Debit Amount (Rs) Particulars Credit Amount (Rs)
Building 4,00,000 Capital Accounts:  
Plant and Machinery 1,20,000     Meena         3,00,000  
Purchases 6,50,000     Reena          2,00,000 5,00,000
Carriage 7,000 Sales 8,14,000
Opening Stock 90,000 Sundry Creditors 1,80,000
Wages 35,000 Bank Overdraft 20,000
Sundry Debtors 1,50,000    
Salaries 28,000    
Postage and Telegram 4,000    
Insurance 5,000    
Bad Debts 3,000    
Rent 4,000    
Discount 3,000    
Drawings:      
   Meena    10,000      
   Reena       5,000 15,000    
  15,14,000   15,14,000
       

Adjustments:

1. Stock on hand on 31st March 2013 was valued at Rs. 1,10,000.

2. Depreciate plant and machinery at 10% p.a.

3. Create reserve for doubtful debts at 5% on sundry debtors.

4. Salaries include Rs. 2,500 as advance to workers.

5. Partners are allowed interest at 5% p.a. on their capitals.


Jitesh and Lailesh are in partnership sharing profits and losses in the ratio of 2:1. From the following Trial Balance and adjustments given below, you are required to prepare Trading and Profit and Loss A/c for the year ended 31st March 2013 and the Balance Sheet as on that date:

Trial Balance as on 31st March 2013
Particulars Debit Amount (Rs) Credit Amount (Rs)
Prepaid Insurance 800  
Insurance 2,000  
R.B.D.D.   1,000
Discount 800  
Postage and telephone 3,200  
Salaries 56,000  
Debtors and Creditors 66,000 68,000
Wages 24,000  
Opening Stock 48,000  
Carriage 1,000  
Purchases and Sales 1,93,200 3,01,600
Return inwards and outwards 5,600 9,200
Bank overdraft   1,20,800
Plant & Machinery 24,000  
Land & Building 1,76,000  
Capital    
Jitesh   52,000
Lailesh   48,000
Total 6,00,600 6,00,600
     
Adjustments:
1. Write off Rs. 2,000 for bad debts and provide R.B.D.D. 5% on debtors.
2. Goods worth Rs. 4,000 were distributed as free samples.
3. Closing stock on 31.03.2013 was valued at the cost Rs. 56,000 while its market price was Rs. 60,000.
4. Salaries were outstanding Rs. 2,000.
5. Depreciate:
Land and Building @ 5% p.a. and
Plant & Machinery @ 10% p.a. 

Ashok and Tanaji are Partners sharing Profits and Losses in the ratio 2 : 3 respectively. Their Trial Balance as on 21st March, 2007 is given below. You are required to prepare Trading and Profit and Loss Account for the year ended 31st March, 2007 and Balance Sheet as on that date after taking into account the given adjustments.

 Trial Balance as on 31 st March 2007

Receipts

Debit
Amount
 (Rs)

Particulars

Credit
Amount
 (Rs)

Purchases

Patents Right

Building

Stock (1.04.2006)

Printing and Stationery

Sundry Debtors

Wages and Salaries

Audit fees

Sundry Expenses

Furniture

10% Investment (Purchased on 30.09.2006)

Cash

Provident Fund Contribution

Carriage Inwards

Travelling Expenses

98,000

4,000

1,00,000

15,000

1,750

35,000

11,000

700

3,500

8,000

 

10,000

4,000

 

800

1,300

2,700

 

Capitals :

       Ashok

       Tanaji

Provident Fund

Creditors

Bank Loan

Sales

Reserve for

Doubtful Debts

Purchase Returns

 

30,000

40,000

7,000

45,000

12,000

1,58,000

 

250

3,500

2,95,750

2,95,750

Adjustments:

1. Closing stock is valued at the cost of Rs. 15,000 while its market price is Rs. 18,000

2. On 31st March, 2007 the stock of stationery was Rs. 500.

3. Provided reserve for bad and doubtful debts at 5% on debtors.

4. Depreciate building at 5% and patent rights at 10%.

5. Interest on capitals is to be provided at 5% p. a.

6. Goods worth Rs. 10,000 were destroyed by fire.

The Insurance company admitted a claim for Rs. 8,000. 


From the following Trial Balance of M/s Kale and Gore, you are required to prepare Trading and Profit and Loss Account for the year ended 31st March, 2013 and Balance Sheet on that date. They share profits and losses in their capital ratio.

                    Trial Balance as on 31st March, 2013

Debit Balance
Amount
Rs
Credit Balance
Amount
Rs
Opening stock

28,000

Capital A/c  
Purchases 1,16,400 Kale 80000
Trade Expenses

2,400

Gore 40000
Royalties 6,200 Sundry Creditors 54000
Wages and Salaries 14,800 Sales 212000
Advertisement 8,200 Reserve for Doubtful Debts 1800
Salaries 11,000 Bills payable 36000
Plant and Machinery 44,000    
Freehold Property

36,000

 
Office Rent 4000  
Motor Van 63000  
Bills Receivable 16000  
Sundry Debtors 60000  
Cash in hand 10000  
Bad debts 1000  
General expenses 2,800  
  423800   423800

Adjustments:

1) Closing stock was valued at cost Rs 76,000 while its market price was Rs 80,000.

2) Uninsured goods worth Rs 10,000 were stolen.

3) Goods worth Rs 10,000 were sold and delivered on 31st March 2013, but on entry is passed sales book.

4) Depreciate Plant and Machinery at 10% and Motor van at 15% p.a.

5) Bills Receivable includes a dishonoured bill of Rs 4,000.

6) Create a reserve for doubtful debts at 5% on Debtors.


Answer in one sentence only.
What is meant by Reconstitution of partnership ?


The Balance Sheet of Rajkumar and Rajendra Kumar as on 31st March 2012 is set out below, they share profits and losses in the ratio of 2:1.

Balance Sheet as on 31st March, 2012

Liabilities
Amount
(Rs)
Assets
Amount
(Rs)
Capital A/c’s - Rajkumar 200000 Buildings 100000
Rajendra Kumar 150000 Furniture 30000
General Reserve 120000 Stock 60000
Creditors 80000 Debtors 300000
    Cash 30000
  Profit and Loss A/c 30000
  550000   550000

They agreed to admit Dhiraj Kumar on 1st April, 2012 as a partner into the firm on the following terms on.

(1) Dhiraj Kumar to bring Rs 60,000 as capital and Rs 45,000 as a goodwill, which is to be retained in the business. He will be entitled to 1/4th share of profit of the firm.

(2) 50% of General Reserve is to remain as Reserve for doubtful debts.

(3) Furniture is to be depreciated by 5%.

(4) Stock is to be revalued at Rs 65,000/-

(5) Creditors of Rs 5,000 are not likely to claim and hence should be written off.

(6) Rent of Rs 2,000 due but not received has not been recorded in the books.

Pass the necessary journal entries in the books of new firm and prepare Balance Sheet of the new firm.


Suresh and Ramesh are partners in a business sharing Balance sheet as on 31st March 2013 are as follows:

Balance Sheet as on 31st March 2013
Liabilities Amount (Rs) Amount
(Rs)
Assets Amount
(Rs)
Amount
(Rs)
Capital A/c’s   Building 30000
Suresh 50000 74000 Machinery 10000
Ramesh 24000 Furniture 9500
Creditors 57000 Debtors 40000 39000
Bills Payable 20000 (-) R.D.D 1000
Reserve fund 9000 Stock 30000
    Bills Receivable 7600
  Cash at Bank 33900
  160000   160000

They admitted Kailash on 1st April 2013 as a partner on the following terms:

1) Kailash will bring Rs 30,000 as his capital for 1/4th share in future profit and Rs. 12,000 as goodwill which will be withdrawn by old partners.

2) Stock and Machinery to be depreciated by 10%.

3) R.D.D. is to be maintained at 5% on debtors.

4) Building to be appreciated by 20% and furniture is revalued at Rs 10,000.

Prepare Profit and Loss Adjustment Account, Partner’s Capital Accounts, and Balance Sheet of the New firm.


Snehal and Meenal are equal partners in a business. Their Balance sheet is as follows :

                 Balance Sheet as on 31st March, 2012

Liabilities Amount
(Rs)
Amount (Rs) Assets Amount
(Rs)
Amount
(Rs)
Capital A/c’s     Premises   20500
Snehal 80000 125000

Investments

  10500
Meenal 45000 Equipments   5000
Creditors   26000 Bills Receivable   18000
Bank Loan (Taken on 1.1.2012)   40000 Debtors 110000 99000
      (-) R.D.D 11000
    Profit and Loss A/c   6600
    Bank   31400
  191000   191000

They agreed to admit Kamal on 1st April, 2012 on the following terms.

1) He should bring 50,000 towards his capital for 1/4th share in future profit.

2) Goodwill A/c be raised in the books of the firm Rs 40,000/-

3) R.D.D to be maintained at 5% on debtors.

4) Premises to be valued at Rs 30,000 and Equipments to be written off fully.

5) Interest at the rate of 15% p.a. is due on bank loan.

6) Creditors allowed a discount of Rs 1100/- and they were paid off immediately.

Pass necessary journal entries to record the above scheme of admission.


Following is the balance sheet of Harish and Girish

               Balance Sheet as on 31st March, 2010

Liabilities Amount (Rs) Amount (Rs) Assets Amount (Rs) Amount (Rs)
Creditors   38000 Cash in Hand   37000
Bills Payable   46,000 Stock   21000
Profit and Loss A/c   16,000 Debtors 46000 40000
Capital A/c’s     (-)R.D.D 6000
Harish 100000 240000 Equipments   12000
Girish 140000 Furniture   25000
      Plant   85000
    Building   120000
  340000   340000

They admitted Shirish on 1st April 2010 on the following conditions:

1) For his 1/3rd share in the future profits Shirish brings Rs 2,00,000 as his Capital.

2) It is decided to raise goodwill by Rs 90,000 and write it off fully after Shirish’s admission.

3) Equipments and plant to be depreciated by 20% and10% respectively and Building to be appreciated by 15%.

4) Bills Payable were retired for Rs 35,000

5) All debtors are considered good.

6) Furniture of the book value Rs 12,000 was taken over by Harish at 40% of the book value.

Prepare, revaluation A/c, Partner’s Capital Account and Balance Sheet of the new firm.


Raj and Dev are partners sharing profits and losses 3:2 respectively. Their position on 31st March, 2011

                  Balance Sheet as on 31st March, 2011

Liabilities Amount (Rs) Assets   Amount (Rs)
Capital A/c’s   Buildings   100000
Raj 100000 175000 Furniture   10000
Dev 75000 Stock   31000
Creditors 10000 Debtors 50000 49000
Bills Payable 5000 (-) R.D.D 1000
General Reserve 15000 Bank Balance 15000
  205000   205000

On 1st April, 2011 they admitted Manoj on following terms:

1) Manoj should bring in cash Rs 1,00,000 as a capital for 1/5th share in future profit and Rs 25,000 as goodwill.

2) Building should be revalued for Rs 1,25,000.

3) Depreciate furniture at 12 ½ % p.a. and stock at 10% p.a.

4) R.D.D. should be maintained as it is.

5) The Capital accounts of partners should be adjusted in their new profit sharing ratio through bank account.

Prepare, Profit and Loss Adjustment Account, Capital Accounts, Balance Sheet of new firm and show how you have calculated new ratio and new capital.


Following is the Balance Sheet of Dhiraj and Niraj who shared profits and losses equally.

                  Balance Sheet as on 31st March, 2013

Liabilities Amount (Rs) Assets Amount (Rs)
Capital A/c’s   Plant and Machinery 45000
Dhiraj 125000 Land and Building 84000
Niraj 35000 Patents 3400
Creditors 86200 Stock 47800
Bills Payable 28,000 Furniture 10600
General Reserve 6800 Debtors 80000
    Cash 10200
  281000   281000

On 1st April, 2013 they agreed to admit Suraj on the following terms and conditions:

1) Suraj to bring for 1/3rd share in future profit in cash Rs 90,000 towards his capital.

2) The firms goodwill should be raised to Rs 90,000 and it is to be written off after Suraj admission in new profit ratio.

3) Plant and Machinery was found undervalued by 10% and Land and Building was found overvalued by 20%.

4) Stock to be increased by Rs 2,200 and furniture to be reduced to Rs 10,000/-

5) Out of creditors Rs 1,200 is no more payable.

6) The Capital A/c to be adjusted in new profit sharing ratio by opening the current accounts.

Prepare Revaluation A/c, Capital A/c and New Balance Sheet.


Vaibhav and Vilas were partners sharing profit and losses in the ratio of 2: 3 respectively. Their Balance Sheet as on 31st March 2012 was as follows.

               Balance Sheet as on 31st March 2012

Liabilities Amount(Rs) Assets Amount(Rs)
Capital A/c's   Land and Building 25000
Vaibhav 50000 Plant 30000
Vilas 50000 Furniture 2000
Creditors 70000 Stock 50000
    Debtors 58000
  Cash 5000
  170000   170000

They agreed to admit Vivek as a partner on 1st April 2012 on the following terms:

1) Vivek will have 1/4th share in future profits for which he shall bring Rs 25,000 as his capital and Rs 20,000 as his share of goodwill.

2) Land & Building are valued at Rs 30,000 and while stock is valued at Rs 55,000.

3) Plant is taken over by Vilas 10% discount.

4) Depreciate furniture by 10%.

5) Provision for bad and doubtful debts is to be maintained at 5% on debtors.

6) The capital account of all the partners to be adjusted in their new profit sharing ratio and excess amount to be transferred to their loan account.

Prepare Profit and Loss Adjustment Account, Partner's Capital Accounts and Balance Sheet of New Firm.


Manoj and Rahul are equal partners in a business. Their Balance sheet as on 31st March, 2013 stood as under:

                 Balance Sheet as on 31st March, 2013

Liabilities Amount(Rs) Asset Amount(Rs)
Sundry Creditors 180000 Cash at Bank 120000
General Reserve 36000 Debtors 62000 60000
Capitals-   (-)R.D.D 2000
Manoj 90000 Bills receivable 24000
Rahul 60000 Building 114000
    Machinery 48000
  366000   366000

They decided to admit Amit on 1st April, 2013 on the following terms:

1) The Machinery and Building be depreciated by 10%

2) Reserve for doubtful debts to be increased to Rs 5,000.

3) Bills receivable are taken over by Manoj at a discount of 5%.

4) The amount of creditors paid at a discount of 10%.

5) The Capital Accounts of all the partners be adjusted in current account of partners.

6) Amit should bring Rs 80,000 as capital for his 1/4th in future profits and goodwill account be opened in the books of the firm at Rs 40,000.

Prepare Profit and Loss Adjustments A/c, Partner’s Capital A/c and Balance sheet of the firm at Rs 4,000/-


The Balance Sheet of Ramakant and Shyamkant who shared the profits in the ratio of 2:1 is as under

Balance Sheet as on 31st March, 2012

Liabilities Amount(Rs) Assets Amount(Rs)
Capitals:   Leasehold Property 20000
Ramakant 134000 254000 Live Stock 6600
Shyamkant 120000 Loose Tools 90200
Creditors 51000 Stock 84800
Rent Outstanding 10000 Debtors 48000 46000
Reserve Fund 7200 (-) R.D.D 2000
Current A/c   Bank 75400
Ramakant 2800 Current A/c  
    Shyamkant 2000
  325000   325000

On 1st April, 2012 Umakant was admitted as 1/4th partner on the following terms:

1) He brings equipments of Rs 80,000 as his capital.

2) Firm’s goodwill is valued at Rs 1,44,000 and Umakant agreed to bring his share in firm’s goodwill by cheque.

3) R.D.D. should be maintained at 7.5% on debtors.

4) Increase live stock by Rs 2,600 and write off loose tools by 20%.

5) Outstanding rent paid Rs 9,040 in full settlement.

Pass necessary journal entries to record the above scheme of admission.


Sanil, Nitish, Sapna were partners in a firm sharing profits and losses in the proportion of 1/2, 1/3 and 1/6 respectively. Their Balance Sheet as on 31st March, 2012 was as follows:

              Balance Sheet as on 31-03-2012

Liabilities Amount (Rs) Assets Amount (Rs)
Bills Payable 30000 Machinery 40000
Capitals:   Furniture 5000
Sanil 80000 Sundry Assets 60000
Nitish 50000 Stock 30000
Sapna 30000 Debtors 32000
    Bank 23000
  190000   190000

Sapna decided to retire on 1st April 2012 on following terms:-

1) Goodwill of the firm will be valued at Rs 30,000/-

2) Furniture was taken over by Sanil for Rs 4,700/-

3) Make a provision for unpaid expenses Rs 1,700/-

4) Out of the amount due to Sapna Rs 7,500/- to be paid by cheque and the remaining amount to be transferred to her loan account.


Pai, Amba and Manoj are partners in a firm sharing profit and losses in the proportion to their capitals. Their Balance Sheet as on 31.3.2012 is as follow: 

        Balance Sheet as on 31st March, 2012

 

Liabilities Amount (Rs) Assets Amount (Rs)
Capitals   Cash 3,000
Pai 30,000 Stock 12,000
Amba 30,000 Debtors 20,000
Manoj 15,000 Plant 13,000
Creditors 7,000 Building 20,000
Outstanding expenses 15,000 Motor Van 31,000
Profit and Loss A/c 20,000 Goodwill 18,000
  1,17,000   1,17,000

On the above date Pai retired and the following adjustments have been agreed upon

1) Goodwill was revalued at Rs 15,000

2) Assets and Liabilities were revalued as under debtors Rs 17,000 stock at 90% of book value Building Rs 35,000 Plant Rs 11,500 Motor Van Rs 29, 500, Outstanding expenses Rs 18,000

3) Amba and Manoj contributed additional capital of Rs 20,000 and Rs 10,000 respectively

4) Balance due to Mr. Pai is transferred to his loan account after paying him Rs 1,000/-

Prepare:- Profit and Loss adjustment A/c,. Partner’s Capital A/c’s and Balance Sheet of new firm


Shedge, Mayekar and Raut were partners sharing profits and losses in the ratio of 4: 3: 3.
Their Balance Sheet on 31st March 2012 was as given below:-

             Balance Sheet as on 31st March, 2012

 

Liabilities Amount (Rs) Assets Amount (Rs)
Capitals   Furniture 4,200
Shedge 15,000 Stock 13,000
Mayekar 10,000 Debtors 10,000
Raut 10,000 Bill Receivable 18,000
    Cash/Bank 2,000
    Profit and Loss A/c (Loss) 5,800
  53,000   53,000

Raut retired from the business on above date and it was agreed that the amount due to Raut to be paid immediately by availing overdraft facility

1) His share of goodwill was raised at Rs 3,500

2) Revalue furniture Rs 4,000 and stock Rs 16,000

3) Create R.D.D. at 5% on Debtors.

4) Make provision for outstanding printing bill Rs 6,000. Prepare profit and loss adjustment A/c, Capital A/c and Balance Sheet of continuing partners assuming that goodwill is written off by the continuing partners.


Vilas, Mangal, Guru were partners in a business sharing profits and losses in the ratio of 2:1:1 respectively. Their Balance sheet as on 31st March, 2012 was as follows: 

          Balance Sheet as on 31st March 2012

Liabilities  Amount (Rs) Assets Amount (Rs)
Capital   Land and Building 6,000
Vilas 6,000 Debtors 5,000
Mangal 7,000 Stock 3,000
Guru 3,400 Cash 6,000
Creditors 2,000    
General Reserve 1,600  
  20,000   20,000

Guru died on 1st July, 2012

1) Land and Building was to be revalued to Rs 7,000 and RDD was to be created of Rs 200.

2) The drawings of Guru upto the date of his death amounted to Rs 1,000/-

3) Charge interest on drawings Rs 100/-

4) His share of goodwill should be calculated at ‘Three’ years purchase of the profits for the last four years which were Rs 15,000, Rs 13,000/-, Rs 7,000, Rs 5,000

5) The deceased partners share of profit upto the date of his death to be calculated on the basis of average profit of last two years.

Prepare:

1) Profit and Loss Adjustment A/c

2) Partners Capital A/cs

3) Balance Sheet of the continuing firm

4) Give working or share of profit and goodwill


Sheetal, Anjali, Rajendra were sharing profits and losses as 7:5:4. Their Balance sheet as on 31st March, 2011:

           Balance Sheet as on 31st March 2012

Liabilities  Amount (Rs) Assets Amount (Rs)
Capital   Furniture 17,000
Sheetal 23,000 Machinery 18,000
Anjali 15,000 Building 16,000
Rajendra 12,000 Cash 37,000
Bills Payable 4000    
Creditors 8000  
Loan 10,000  
General Reserve 16,000  
  88,000   88,000

Rajendra died on 30th June 2012 and the following adjustments were agreed as per deed.

1) Furniture, Machinery and Building are to be revalued at Rs 16,700/-, Rs 16,200, to Rs 30,100.

2) Rajendra’s share is goodwill to be valued from firm’s goodwill which was valued at two times the average profit of last three years. Profits of last three years Rs 30,000, Rs 25,000, Rs 20,000/-.

3) His profit upto the date of death is to be calculated on the basis of last years profit.

4) Rajendra was entitled to get a salary of Rs 800/-per month.

5) Interest on capital at 10% be allowed.

6) Rajendra’s drawing upto date of death were Rs 600 p.m. 
Prepare:
1) Rajendra’s Capital A/c showing amount payable to his executor
2) Give working of share of goodwill and profit


The Balance sheet of Mohan, Subhash and Babi as on 31st December, 2011 was as under. They were sharing profits and losses in the ratio of 2:1:1.

            Balance Sheet as on 31st December,2011

Liabilities  Amount (Rs) Assets Amount (Rs)
Capital   Investments 20000
Mohan 25,000 Buildings 33000
Subhash 15,000 Debtors 12000
Babi 15,000 Stock 28000
Creditors 30,000 Cash   8000
Reserve 16000    
  101000   101000

Babi died on 1st July, 2012 and partnership deed provided that in the event of death of the partner his executor will be entitled to be paid out.

1) Capital to the credit at the date of last balance sheet

2) Proportion of reserves

3) Proportion of goodwill to be calculated twice the average profits of last three years.

4) His proportion of profits to the date of death based on the average profits of the last three year plus 20%.

5) The net profits for last 3 years Rs 18,000, Rs 18,000, Rs 16,500.

6) Babi had withdrawn Rs 6,000/- to the date of her death.

7) The investments were sold at par and the amount was paid off to Babi’s executor and the balance was transferred to loan A/c.

Prepare: 
1) Babi’s Capital A/c only.


Minaxi, Ramesh and Poonam were partners sharing profits and losses in the proportion to their capitals, Their Balance sheet of the firm on 31st March, 2012 was as under:

           Balance Sheet as on 31st March, 2012

Liabilities Amount (Rs) Assets Amount (Rs)
Capital   Land and Building 40,000
Minaxi 30,000 Investment 20,000
Ramesh 20,000 Debtors 16,000 14,000
Poonam 10,000 Less : R.D.D 2,000
Creditors 28,000 Stock 18,000
Reserve 18,000 Cash  14,000
  1,06,000   1,06,000

Poonam died on 1st August, 2012 and the following adjustments were made

1) Assets revalued as under-Land & Building Rs 44,000, Investment Rs 18,000, Stock Rs 17,000.

2) All debtors were good.

3) Goodwill of the firm valued at two times the average profits of the last 4 years. No goodwill account to be shown in the books of the firm.

4) Poonam’s share of profit upto her death to be calculated on the basis of average profits of last two year.

5) Profits were Rs 6,000, Rs 12,000, Rs 7,000, Rs 11,000
Prepare:
1) Profits and loss adjustment A/c
2) Balance sheet as on 1st August 2012


Following is the Balance Sheet of Dhirshree, Sonam, and Simaran who were sharing profit and losses in the proportion of their capitals:

Balance Sheet as on 31st March, 2016

Liabilities Amount (Rs.) Assets Amount (Rs.)
Capital accounts:   Plant and Machinery 60,000
Dhirshree 1,50,000 Land and building 1,65,000
Sonam 60,000 Stock 36,000
Simaran 90,000 Debtors               36,000  
Sundry Creditors 45,000 Less: R.D.D.         3,000 33,000
    Bank balance 51,000
  3,45,000   3,45,000

Simran retired from the business on 31st March 2016 and the following adjustments were agreed to:
1) The stock is to be valued at 92% of its book value.
2) R.D.D. is to be maintained at 10% on sundry Debtors.
3) The value of land and building be appreciated by 20%.
4) The goodwill of the firm be fixed at Rs. 36,000 and simran's share in the same adjusted in the accounts of containuing partners in the gain ratio.
5) The entire capital of the new firm be fixed at Rs. 4,80,000 between Dhirshree and Sonam in the proportion to their new profit sharing ratio which is fixed as 3: 1 by making adjustment for difference in cash.
Prepare : 
1) Profit and Loss Adjustment Account.
2) Partner's Capital Accounts.
3) Balance Sheet after retirement of Simran.


State True or False with reason.

Change in the relationship between the partners is called the Reconstitution of partnership.


Pravin and Kishor are partners sharing profits and losses in the ratio 3 : 2. Their Balance Sheet as on 31st March, 2019 was as under:

Balance Sheet as on 31st March, 2019
Liabilities  
Amount
(₹)
Assets
 
Amount
(₹)
Creditors   37,500 Bank   22,500
Bills Payable   30,000 Bills Receivable   11,400
Bank Loans   48,000 Debtors 62,400 60,000
General Reserve   7,500 Less: RDD 2,400
Capitals:     Stock   36,000
Pravin 45,000 81,000 Furniture   14,100
Kishor 36,000 Machinery   15,000
      Buildings   45,000
    2,04,000     2,04,000

On 1.04.2019 they admitted Asha on the following terms:

  1. For 1/2 share in profits in future, Asha will bring ₹ 30,000 for capital and ₹ 15,000 for goodwill.
  2. Half of the amount of goodwill is withdrawn by old partners.
  3. Stock is to be depreciated by 10% and Machinery by 5%.
  4. RDD is to be maintained at ₹ 3,000.
  5. Furniture be valued at ₹ 16,050 and Building be appreciated by 20%

Pass the necessary Journal entries in the books of the firm and prepare working notes.


Find the odd one:


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