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Solution - Reconstitution of Partnership Examples and Solutions

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Question

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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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

LiabilitiesAmount (Rs.)AssetsAmount (Rs.)
Creditors34800Cash21600
Bills Payable8800Machinery34800

Capital A/c

        Vaishali

        Madhuri

        Shobha

 

48000

52000

36000

Debtors50000
 Reserved Fund16000Stock25200
  Furniture16000
  Building48000
 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.

view solution

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

LiabilitiesAmount (Rs.)AssetsAmount (Rs.)

Capital A/c

          Akash

          Suraj

 

50000

50000

Furniture2100

General Reserve

10000Stock28700
Sundry creditors60000Land and building35000
Bills payable17000Plant and machinery49000
  Sundry debtors63000
  Cash9200
 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.
view solution
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.

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