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प्रश्न
A, B and C were partners sharing profits and losses in the ratio of 2 : 2 : 1. C died on 30th June, 2018. Profit and Sales for the year ended 31st March, 2018 were ₹ 1,00,000 and ₹ 10,00,000 respectively. Sales during April to June, 2018 were ₹ 1,50,000. You are required to calculate share of profit of C up to the date of his death.
उत्तर
Profit for the year 2017-18 = Rs 1,00,000
Sales for the year 2017-18 = Rs 10,00,000
Ratio of profit to sales in 2017 - 18 = `(1,00,000)/(10,00,000) xx 100 = 10%`
Sales from April 01 2018 to June 30, 2018 = Rs 1,50,000
∴Profit from April 01, 2018 to June 30, 2018 on the basis of Profit Ratio of 2017-18 = `150,000 xx 10/100 = 15,000`
∴C’s Profit Share (from April 01, 2018 to June 30, 2018)
= `15,000 xx 1/5 = "Rs" 3,000`
APPEARS IN
संबंधित प्रश्न
Harish, Paresh and Mahesh were three partners as sharing profits and losses in the ratio of 5:4:1. Paresh retired on 31st March, 2017. His capital on 1st April, 2016, was Rs. 80,000. During the year 2016-17, he made drawings of Rs. 5,000. He was to be charged interest on drawings of ` 100. The partnership deed provides that on the retirement of a partner, he will be entitled to:
(i) His share of capital.
(ii) Interest on capital @ 10% per annum.
(iii) His share of profit for the year of his retirement.
(iv) His share of goodwill in the firm.
(v) His share in the profit/loss on revaluation of assets and liabilities.
Additional information:
(a) Paresh's share in the profits of the firm for the year 2016-17 was Rs. 20,000.
(b) Goodwill of the firm was valued at Rs. 24,000.
(c) The firm suffered a loss of Rs.12,000 on the revaluation of assets and liabilities.
(d) It was decided to transfer the amount due to Paresh to his loan account bearing interest @ 6% per annum. The loan was to be repaid in two equal annual instalments, the first instalment to be paid on 31st March, 2018.
You are required to prepare:
(i) Paresh's Capital Account.
(ii) Paresh's Loan Account till it is finally closed.
A, B, C were partners in a firm sharing profits in 3:2:1 ratio. They admitted D for 10% profits. Calculate the new profit sharing ratio?
Radha and Rukmani are partners in a firm sharing profits in 3:2 ratio. They admitted Gopi as a new partner. Radha surrendered 1/3 of her share in favour of Gopi and Rukmani surrendered 1/4 of her share in favour of Gopi. Calculate new profit sharing ratio?
X, Y and Z were in partnership sharing profits and losses in the proportions of 3 : 2 : 1. On 1st April, 2019, Y retired from the firm. On that date, their Balance Sheet was:
Liabilities | Amount (₹) |
Assets | Amount (₹) |
|
Trade Creditors | 30,000 | Cash in Hand | 15,000 | |
Bills Payable | 45,000 | Cash at Bank | 75,000 | |
Expenses Owing | 45,000 | Debtors | 1,50,000 | |
General Reserve | 1,35,000 | Stock | 1,20,000 | |
Capital A/cs: | Factory Premises | 2,25,000 | ||
X |
1,50,000 | Machinery | 80,000 | |
Y |
1,50,000 | Loose Tools | 40,000 | |
Z |
1,50,000 | 4,50,000 | ||
7,05,000 | 7,05,000 |
The terms were:
(a) Goodwill of the firm was valued at ₹ 1,35,000 and adjustment in this respect was to be made in the continuing Partners' Capital Accounts without raising Goodwill Account.
(b) Expenses Owing to be brought down to ₹ 37,500.
(c) Machinery and Loose Tools are to be valued @ 10% less than their book value.
(d) Factory Premises are to be revalued at ₹ 2,43,000.
Show Revaluation Account, Partners' Capital Accounts and prepare the Balance Sheet of the firm after the retirement of Y.
X, Y and Z are partners sharing profits and losses in the ratio of 3 : 2 : 1. Balance Sheet of the firm as at 31st March, 2019 was as follows:
Liabilities |
Amount (₹) |
Assets |
Amount (₹) |
||
Creditors |
21,000 |
Cash at Bank | 5,750 | ||
Workmen Compensation Reserve |
12,000 |
Debtors |
40,000 |
|
|
Investments Fluctuation Reserve |
6,000 |
Less: Provision for Doubtful Debts |
2,000 |
38,000 |
|
Capital A/cs: | Stock | 30,000 | |||
X | 68,000 | Investment (Market Value ₹ 17,600) | 15,000 | ||
Y |
32,000 |
|
Patents | 10,000 | |
Z |
21,000 |
1,21,000 |
Machinery |
50,000 |
|
Goodwill | 6,000 | ||||
Advertisement Expenditure | 5,250 | ||||
1,60,000 |
1,60,000 |
Z retired on 1st April, 2019 on the following terms:
(a) Goodwill of the firm is to be valued at ₹ 34,800.
(b) Value of Patents is to be reduced by 20% and that of machinery to 90%.
(c) Provision for doubtful debts is to be created @ 6% on debtors.
(d) Z took over the investment at market value.
(e) Liability for Workmen Compensation to the extent of ₹ 750 is to be created.
(f) A liability of ₹ 4,000 included in creditors is not to be paid.
(g) Amount due to Z to be paid as follows: ₹ 5,067 immediately, 50% of the balance within one year and the balance by a draft for 3 Months.
Give necessary Journal entries for the treatment of goodwill, prepare Revaluation Account, Capital Accounts and the Balance Sheet of the new firm.
X, Y and Z are partners sharing profits in the ratio of 5 : 3 : 7. X retired from the firm. Y and Z decided to share future profits in the ratio of 2 : 3. The adjusted Capital Accounts of Y and Z showed balance of ₹ 49,500 and ₹ 1,05,750 respectively. The total amount to be paid to X is ₹ 1,35,750. This amount is to be paid by Y and Z in a manner that their capitals become proportionate to their new profit-sharing ratio. Calculate the amount to be brought in or to be paid to partners.
X, Y and Z are partners sharing profits in the ratio of 5 : 3 : 2. Y retires on 1st April, 2019 from the firm, on which date capitals of X, Y and Z after all adjustments are ₹ 1,03,680, ₹ 87,840 and ₹ 26,880 respectively. The Cash and Bank Balance on that date was ₹ 9,600. Y is to be paid through amount brought in by X and Z in such a way as to make their capitals proportionate to their new profit-sharing ratio which will be X 3/5 and Z 2/5. Calculate the amount to be paid or to be brought in by the continuing partners assuming that a minimum Cash and Bank balance of ₹ 7,200 was to be maintained and pass the necessary Journal entries.
A, B and C are partners in a firm sharing profits and losses in the ratio of 3 : 2 : 1. Their Balance Sheet as at 31st March, 2019 is:
Liabilities |
Amount (₹) |
Assets |
Amount (₹) |
||
Creditors |
30,000 |
Cash in Hand | 18,000 | ||
Bills Payable |
16,000 |
Debtors |
25,000 |
|
|
General Reserve |
12,000 |
Less: Provision for Doubtful Debts |
3,000 |
22,000 |
|
Capital A/cs: | Stock | 18,000 | |||
A |
40,000 |
|
Furniture | 30,000 | |
B | 40,000 | Machinery | 70,000 | ||
C |
30,000 |
1,10,000 |
Goodwill |
10,000 |
|
1,68,000 |
1,68,000 |
B retires on 1st April, 2019 on the following terms:
(a) Provision for Doubtful Debts be raised by ₹ 1,000.
(b) Stock to be reduced by 10% and Furniture by 5%.
(c) Their is an outstanding claim of damages of ₹ 1,100 and it is to be provided for.
(d) Creditors will be written back by ₹ 6,000.
(e) Goodwill of the firm is valued at ₹ 22,000.
(f) B is paid in full with the cash brought in by A and C in such a manner that their capitals are in proportion to their profit-sharing ratio and Cash in Hand remains at ₹ 10,000.
Prepare Revaluation Account, Partners' Capital Accounts and the Balance Sheet of A and C.
X, Y and Z were partners in a firm Z died on 31st May, 2021. His share of profit from the closure of the last accounting year till the date of death was to be calculated on the basis of the average of three completed years of profits before death. Profits for the years ended 31st March, 2019, 2020 and 2021 were ₹18,000 ₹ 19,000 and ₹ 17,000 respectively. Calculate Z's share of profit till his death and pass necessary Journal entry for the same when:
(a) Profit-sharing ratio of remaining partners does not change, and
(b) Profit-sharing ratio of remaining partners changes and new ratio being 3:2.
X, Y, and Z were partners in a firm sharing profits in the ratio of 4 : 3 : 1. The firm closes its books on 31st March every year. On 1st February, 2020, Y died and it was decided that the new profit-sharing ratio between X and Z will be equal. Partnership Deed provided for the following on the death of a partner:
(a) His share of goodwill be calculated on the basis of half of the profits credited to his account during the previous four completed years. The firm's profits for the last four years were:
Year | 2015-16 | 2016-17 | 2017-18 | 2018-19 |
Profit (₹) | 1,50,000 | 1,00,000 | 50,000 |
1,00,000
|
(b) His share of profit in the year of his death was to be computed on the basis of average profit of past two years.
Pass necessary Journal entries relating to goodwill and profit to be transferred to Y's Capital Account.
Iqbal and Kapoor are in partnership sharing profits and losses in 3 : 2. Kapoor died three months after the date of the last Balance Sheet. According to the Partnership Deed, the legal heir is entitled to the following:
(a) His capital as per the last Balance Sheet.
(b) Interest on above capital @ 3% p.a. till the date of death.
(c) His share of profits till the date of death calculated on the basis of last year's profits.
His drawings are to bear interest at an average rate of 2% on the amount irrespective of the period.
The net profits for the last three years, after charging insurance premium, were ₹ 20,000; ₹ 25,000 and ₹ 30,000 respectively. Kapoor's capital as per Balance Sheet was ₹ 40,000 and his drawings till the date of death were ₹ 5,000.
Draw Kapoor's Capital Account to be rendered to his representatives.
A, B and C were partners in a firm sharing profits in the ratio of 5 : 3 : 2. On 31st March, 2018, their Balance Sheet was as follows:
Liabilities |
₹ |
Assets |
₹ |
||
Creditors |
11,000 |
Building |
20,000 |
||
Reserves |
6,000 |
Machinery |
30,000 |
||
A's Loan A/c | 5,000 | Stock | 10,000 | ||
Capital A/cs: |
Patents | 11,000 | |||
A |
25,000 |
Debtors | 8,000 | ||
B | 25,000 | Cash | 8,000 | ||
C |
15,000 |
65,000 |
|||
87,000 |
87,000 |
A died on 1st October, 2018. It was agreed among his executors and the remaining partners that:
(i) Goodwill to be valued at 212 years' purchase of the average profit of the previous 4 years, which were 2014-15: ₹ 13,000; 2015-16: ₹ 12,000; 2016-17: ₹ 20,000 and 2017-18: ₹ 15,000.
(ii) Patents be valued at ₹ 8,000; Machinery at ₹ 28,000; and Building at ₹ 25,000.
(iii) Profit for the year 2017-18 be taken as having accrued at the same rate as that of the previous year.
(iv) Interest on capital be provided @ 10% p.a.
(v) Half of the amount due to A to be paid immediately to the executors and the balance transferred to his (Executors') Loan Account.
Prepare A's Capital Account and A's Executors' Account as on 1st October, 2018.
Virad, Vishad and Roma were partners in a firm sharing profits in the ratio of 5 : 3 : 2 respectively. On 31st March, 2013, their Balance Sheet was as under:
Liabilities | ₹ | Assets | ₹ | ||
Capital A/cs: | Buildings | 2,00,000 | |||
Virad | 3,00,000 | Machinery | 3,00,000 | ||
Vishad | 2,50,000 | Patents | 1,10,000 | ||
Roma | 1,50,000 | 7,00,000 | Stock | 1,00,000 | |
Reserve Fund | 60,000 | Debtors | 80,000 | ||
Creditors | 1,10,000 | Cash | 80,000 | ||
8,70,000 | 8,70,000 |
Virad died on 1st October, 2013. It was agreed between his executors and the remaining partners that:
(i) Goodwill of the firm be valued at 212 years purchase of average profits for the last three years. The average profits were ₹ 1,50,000.
(ii) Interest on capital be provided at 10% p.a.
(iii) Profits for the 2013-14 be taken as having accrued at the same rate as that of the previous year which was ₹ 1,50,000.
Prepare Virad's Capital Account to be presented to his Executors as on 1st October, 2013.
A, B and C are partners in a firm sharing profits in the proportion of 3 : 2 : 1. Their Balance Sheet as at 31st March, 2018 stood as follows:
Liabilities |
Amount (₹) |
Assets |
Amount (₹) |
||
Sundry Creditors |
2,70,000 |
Cash in Hand |
42,500 |
||
General Reserve |
1,20,000 |
Cash at Bank |
2,14,500 |
||
Capital A/cs: |
Debtors | 1,63,000 | |||
A |
2,00,000 |
Stock | 17,500 | ||
B | 1,20,000 | Investment | 1,32,500 | ||
C |
80,000 |
4,00,000 |
Building | 2,10,000 | |
B's Loan | 10,000 | ||||
7,90,000 |
7,90,000 |
B died on 30th June, 2018 and according to the deed of the said partnership his executors are entitled to be paid as under:
(a) The capital to his credit at the time of his death and interest thereon @ 10% per annum.
(b) His proportionate share of General Reserve.
(c) His share of profit for the intervening period will be based on the sales during that period. Sales from 1st April, 2018 to 30th June, 2018 were as ₹ 12,00,000. The rate of profit during past three years had been 10% on sales.
(d) Goodwill according to his share of profit to be calculated by taking twice the amount of profits of the last three years less 20%. The profit of the previous three years were: 1st Year: ₹ 82,000; 2nd year: ₹ 90,000; 3rd year ₹ 98,000.
(e) The investments were sold at par and his executors were paid out in full.
Prepare B's Capital Account and his Executors' Account.
A, B and C are partners in a firm sharing profits in the proportion of 3 : 2 : 1. Their Balance Sheet as at 31st March, 2018 stood as follows:
Liabilities |
Amount (₹) |
Assets |
Amount (₹) |
||
Sundry Creditors |
2,70,000 |
Cash in Hand |
42,500 |
||
General Reserve |
1,20,000 |
Cash at Bank |
2,14,500 |
||
Capital A/cs: |
Debtors | 1,63,000 | |||
A |
2,00,000 |
Stock | 17,500 | ||
B | 1,20,000 | Investment | 1,32,500 | ||
C |
80,000 |
4,00,000 |
Building | 2,10,000 | |
B's Loan | 10,000 | ||||
7,90,000 |
7,90,000 |
B died on 30th June, 2018 and according to the deed of the said partnership his executors are entitled to be paid as under:
(a) The capital to his credit at the time of his death and interest thereon @ 10% per annum.
(b) His proportionate share of General Reserve.
(c) His share of profit for the intervening period will be based on the sales during that period. Sales from 1st April, 2018 to 30th June, 2018 were as ₹ 12,00,000. The rate of profit during past three years had been 10% on sales.
(d) Goodwill according to his share of profit to be calculated by taking twice the amount of profits of the last three years less 20%. The profit of the previous three years were: 1st Year: ₹ 82,000; 2nd year: ₹ 90,000; 3rd year ₹ 98,000.
(e) The investments were sold at par and his executors were paid out in full.
Prepare B's Capital Account and his Executors' Account.
Sunny, Honey and Rupesh were partners in a firm. On 31st March, 2014, their Balance Sheet was as follows:
Liabilities |
₹ |
Assets |
₹ |
||
Creditors |
10,000 |
Plant and Machinery |
40,000 |
||
General Reserve |
30,000 |
Furniture |
15,000 |
||
Capital A/cs: |
Investments | 20,000 | |||
Sunny |
30,000 |
Debtors | 20,000 | ||
Honey | 30,000 | Stock | 20,000 | ||
Rupesh |
20,000 |
80,000 |
25,000 | ||
1,20,000 |
1,20,000 |
Honey died on 31st December, 2014. The Partnership Deed provided that the representatives of the deceased partner shall be entitled to:
(a) Balance in the Capital Account of the deceased partner.
(b) Interest on Capital @ 6% per annum up to the date of his death.
(c) His share in the undistributed profits or losses as per the Balance Sheet.
(d) His share in the profits of the firm till the date of his death, calculated on the basis of rate of net profit on sales of the previous year. The rate of net profit on sales of previous year was 20%. Sales of the firm during the year till 31st December, 2014 was ₹ 6,00,000.
Prepare Honey's Capital Account to be presented to his executors.
A and B are in partnership sharing profits and losses in the ratio of 5 : 3. C is admitted as a partner who pays ₹ 40,000 as capital and the necessary amount of goodwill which is valued at ₹ 60,000 for the firm. His share of profits will be 1/5th which he takes 1/10th from A and 1/10th from B.
Give Journal entries and also calculate future profit-sharing ratio of the partners.
X, Y and Z are partners in a firm sharing profits and losses in the ratio of 5 : 3 : 2. Their Balance Sheet as at 31st March, 2018 was as follows:
Liabilities | Amount (₹) |
Assets | Amount (₹) |
||
Sundry Creditors | 18,000 | Goodwill | 12,000 | ||
Investments Fluctuation Reserve | 7,000 | Patents | 52,000 | ||
Workmen Compensation Reserve | 7,000 | Machinery | 62,400 | ||
Capital A/cs: | Investment | 6,000 | |||
X | 1,35,000 | Stock | 20,000 | ||
Y | 95,000 | Sundry Debtors | 24,000 | ||
Z |
74,000 | 3,04,000 | Less: Provision for Doubtful Debts | 4,000 | 20,000 |
Loan to Z | 1,000 | ||||
Cash at Bank | 600 | ||||
Profit and Loss A/c | 1,50,000 | ||||
Z's Drawings | 12,000 | ||||
3,36,000 | 3,36,000 |
Z died on 1st April, 2018, X and Y decide to share future profits and losses in ratio of 3 : 5. It was agreed that:
(i) Goodwill of the firm be valued 212 years' purchase of average of four completed years' profits which were: 2014→₹ 1,00,000; 2015-16→₹ 80,000; 2016→17 ₹ 82,000.
(ii) Stock is undervalued by ₹ 14,000 and machinery is overvalued by ₹ 13,600.
(iii) All debtors are good. A debtor whose dues of ₹ 400 were written off as bad debts paid 50% in full settlement.
(iv) Out of the amount of insurance premium debited to Profit and Loss Account, ₹ 2,200 be carried forward as prepaid insurance premium.
(v) ₹ 1,000 included in Sundry Creditors is not likely to arise.
(vi) A claim of ₹ 1,000 on account of Workmen Compensation to be provided for.
(vii) Investment be sold for ₹ 8,200 and a sum of ₹ 11,200 be paid to executors of Z immediately. The balance to be paid in four equal half-yearly instalments together with interest @ 8% p.a. at half year rest.
Show Revaluation Account, Capital Accounts of Partners and the Balance Sheet of the new firm.
R and S are partners sharing profits in the ratio of 5 : 3. T joins the firm as a new partner. R gives 1/4th of his share and S gives 1/5th of his share to the new partner. Find out new profit-sharing ratio.
Find New Profit-sharing Ratio:
R and T are partners in a firm sharing profits in the ratio of 3 : 2. S joins the firm. R surrenders 1/4th of his share and T 1/5th of his share in favour of S.
Find New Profit-sharing Ratio:
A and B are partners. They admit C for 1/4th share. In future, the ratio between A and B would be 2 : 1.
A, B and C are partners sharing profits and losses in the ratio of 5 : 4 : 1. Calculate new profit-sharing ratio, sacrificing ratio and gaining ratio in each of the following cases:
Case 1. C acquires 1/5th share from A.
Case 2. C acquires 1/5th share equally form A and B.
Case 3. A, B and C will share future profits and losses equally.
Case 4. C acquires 1/10th share of A and 1/2 share of B.
X and Y are partners in a firm sharing profits and losses in the ratio of 3 : 2. With effect from 1st April, 2019, they decided to share future profits equally. On the date of change in the profit-sharing ratio, the Profit and Loss Account showed a credit balance of ₹ 1,50,000. Record the necessary Journal entry for the distribution of the balance in the Profit and Loss Account immediately before the change in the profit-sharing ratio.
A and B are partners in a firm sharing profits in the ratio of 4 : 1. They decided to share future profits in the ratio of 3 : 2 w.e.f. 1st April, 2019. On that day, Profit and Loss Account showed a debit balance of ₹ 1,00,000. Pass Journal entry to give effect to the above.
A and B are partners in a firm sharing profits and losses in the ratio of 3 : 2. A new partner C is admitted. A surrenders 1/5th of his share and B surrenders 2/5th of his share and B surrenders 2/5th of his share in favour of C. For the purpose of C's admission, goodwill of the firm is valued at ₹ 75,000 and C brings in his share of goodwill in cash which is retained in the firm's books. Journalise the above transactions.
X, Y and Z who are sharing profits in the ratio of 5 : 3 : 2, decide to share profits in the ratio of 2 : 3 : 5 with effect from 1st April, 2019. Workmen Compensation Reserve appears at ₹ 1,20,000 in the Balance Sheet as at 31st March, 2019 and Workmen Compensation Claim is estimated at ₹ 1,50,000. Pass Journal entries for the accounting treatment of Workmen Compensation Reserve.
A, B and C who are presently sharing profits and losses in the ratio of 5 : 3 : 2 decide to share future profits and losses in the ratio of 2 : 3 : 5. Give the journal entry to distribute 'Investments Fluctuation Reserve' of ₹ 20,000 at the time of change in profit-sharing ratio, when investment (market value ₹ 95,000) appears in the books at ₹ 1,00,000.
Nitin, Tarun and Amar are partners sharing profits equally and decide to share profits in the ratio of 2 : 2 : 1 w.e.f. 1st April, 2019. The extract of their Balance Sheet as at 31st March, 2019 is as follows:
Liabilities | ₹ | Assets | ₹ |
Investments Fluctuation Reserve | 60,000 | Investments (At Cost) | 4,00,000 |
Pass the Journal entries in each of the following situations:
(i) When its Market Value is not given;
(ii) When its Market Value is ₹ 4,00,000;
(iii) When its Market Value is ₹ 4,24,000;
(iv) When its Market Value is ₹ 3,70,000;
(v) When its Market Value is ₹ 3,10,000.
Ashish, Aakash and Amit are partners sharing profits and losses equally. The Balance Sheet as at 31st March, 2019 was as follows:
Liabilities |
Amount |
Assets |
Amount |
|
Sundry Creditors | 75,000 | Cash in Hand | 24,000 | |
General Reserve | 90,000 | Cash at Bank | 1,40,000 | |
Capital A/cs: | Sundry Debtors |
80,000 |
||
Ashish |
3,00,000 |
Stock | 1,40,000 | |
Aakash | 3,00,000 | Land and Building | 4,00,000 | |
Amit |
2,75,000 |
8,75,000 | Machinery | 2,50,000 |
Advertisement Suspense | 6,000 | |||
10,40,000 | 10,40,000 |
The partners decided to share profits in the ratio of 2 : 2 : 1 w.e.f. 1st April, 2019. They also decided that:
(i) Value of stock to be reduced to ₹ 1,25,000.
(ii) Value of machinery to be decreased by 10%.
(iii) Land and Building to be appreciated by ₹ 62,000.
(iv) Provision for Doubtful Debts to be made @ 5% on Sundry Debtors.
(v) Aakash was to carry out reconstitution of the firm at a remuneration of ₹ 10,000.
Pass necessary Journal entries to give effect to the above.
A, B and C are sharing profits and losses in the ratio of 2 : 2 : 1. They decided to share profit w.e.f. 1st April, 2019 in the ratio of 5 : 3 : 2. They also decided not to change the values of assets and liabilities in the books of account. The book values and revised values of assets and liabilities as on the date of change were as follows:
Book values (₹) | Revised values (₹) | |
Machinery | 2,50,000 | 3,00,000 |
Computers | 2,00,000 | 1,75,000 |
Sundry Creditors | 90,000 | 75,000 |
Outstanding Expenses | 15,000 | 25,000 |
Pass an adjustment entry.
X, Y and Z are partners sharing profits and losses in the ratio of 7 : 5 : 4. Their Balance Sheet as at 31st March, 2019 stood as:
Liabilities | Amount (₹) | Assets | Amount (₹) | |
Capital A/cs: | Sundry Assets | 7,00,000 | ||
X | 2,10,000 | |||
Y | 1,50,000 | |||
Z | 1,20,000 | 4,80,000 | ||
General Reserve | 65,000 | |||
Profit and Loss A/c | 25,000 | |||
Creditors | 1,30,000 | |||
7,00,000 | 7,00,000 |
Partners decided that with effect from 1st April, 2019, they will share profits and losses in the ratio of 3 : 2 : 1. For this purpose, goodwill of the firm was valued at ₹ 1,50,000. The partners neither want to record the goodwill nor want to distribute the General Reserve and profits.
Pass a Journal entry to record the change and prepare Balance Sheet of the constituted firm.
X, Y and Z are partners in a firm sharing profits and losses as 5 : 4 : 3. Their Balance Sheet as at 31st March, 2019 was:
Liabilities | Amount (₹) |
Assets | Amount (₹) |
|
Sundry Creditors | 40,000 | Cash at Bank | 40,000 | |
Outstanding Expenses | 15,000 | Sundry Debtors | 2,10,000 | |
General Reserve | 75,000 | Stock | 3,00,000 | |
Capital A/cs: | Furniture | 60,000 | ||
X | 4,00,000 | Plant and Machinery | 4,20,000 | |
Y | 3,00,000 | |||
Z | 2,00,000 | 9,00,000 | ||
10,30,000 | 10,30,000 |
From 1st April, 2019, they agree to alter their profit-sharing ratio as 4 : 3 : 2. It is also decided that:
(a) Furniture be taken at 80% of its value.
(b) Stock be appreciated by 20%.
(c) Plant and Machinery be valued at ₹ 4,00,000.
(d) Outstanding Expenses be increased by ₹ 13,000.
Partners agreed that altered values are not to be recorded in the books and they also do not want to distribute the General Reserve.
You are required to pass a single Journal entry to give effect to the above. Also, prepare Balance Sheet of the new firm.
Following is the Balance Sheet of A and B, who shared Profits and Losses in the ratio of 2 : 1, as at 1st April, 2019:
BALANCE SHEET OF A AND B
as on 1st April, 2019
Liabilities | Amount (₹) |
Assets |
Amount (₹) |
|
Capital A/cs: | Land ad Building | 2,90,000 | ||
A | 3,00,000 | Furniture | 80,000 | |
B | 2,00,000 | 5,00,000 | Stock | 2,40,000 |
Reserve | 1,50,000 | Debtors | 1,50,000 | |
Creditors | 2,00,000 | Bank | 60,000 | |
Cash | 30,000 | |||
8,50,000 | 8,50,000 |
On the above date, the partners changed their profit-sharing ratio to 3 : 2. For this purpose, the goodwill of the firm was valued at ₹ 3,00,000. The partners also agreed for the following:
(a) The value of Land and Building will be ₹ 5,00,000;
(b) Reserve is to be maintained at ₹ 3,00,000.
(c) The total capital of the partners in the new firm will be ₹ 6,00,000, which will be shared by the partners in their new profit-sharing ratio.
Prepare Revaluation Account, Partners' Capital Accounts and the Balance Sheet of the reconstituted firm.
A and B share profits in the ratio of 2 : 1. C is admitted with `1/4` share in profits. C acquires `3/4` of his share from A and `1/4` of his share from B. The new ratio will be:
Assertion (A): New Profit Sharing Ratio is the ratio in which old partners including the new partner, share the profits or losses of the firm.
Reason (R): When a new partner is admitted to the firm it is necessary to calculate the new profit sharing ratio with the help of the share agreed to forgo by the old partners.
A, B and C are partners sharing profit in the ratio of 2 : 2 : 1. C retired. The new Profit Sharing ratio between A and B will be:
Some adjustments are to be made at the time of the retiring partner.
(i) New profit sharing ratio of continuing partners
(ii) Accounting treatment of Goodwill
(iii) Sacrificing ratio of continuing partners
(iv) Accounting treatment of joint life policy.
Which of the above adjustments are to be done?
A & B are partners sharing profits and losses in the ratio of 3 : 2. C is admitted for ¼ and for which ₹ 30,000 and ₹ 10,000 are credited as a premium for goodwill to A and B respectively. The new profit sharing ratio of A : B : C will be ______.