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प्रश्न
Answer the following question in one sentence.
What shows credit balance of revaluation account ?
उत्तर
Profit on Revaluation Account.
APPEARS IN
संबंधित प्रश्न
The gradual and permanent decrease in the value of fixed assets due to any cause.
Answer in one sentence only.
What is revaluation account?
Write the word/term or phrase which can substitute the following statement.
Account which is opened to record the gains and losses on revaluation.
Select the most appropriate answer from the alternative given below and rewrite the sentence.
Account is debited when unrecorded liability is brought into business.
Shanti, Samadhan and Sangarsh were sharing profits and losses in the ratio of 7: 5: 4. Their balance sheet as on 31st .03.2013 was as follows:
|
Liabilities
|
Amount
|
Assets
|
Amount
|
|
Capitals:
|
Furniture
|
17000
|
|
|
Shanti
|
23000
|
Machinery
|
18000
|
|
Samadhan
|
15000
|
Building
|
16000
|
|
Sangharsh
|
12000
|
Cash
|
37000
|
|
Bills Payable
|
4000
|
||
|
Creditors
|
8000
|
||
|
Loan
|
10000
|
||
|
General Reserve
|
16000
|
||
|
88000
|
88000
|
__________ is credited when an unrecorded asset is brought into the business.
Write a word/phrase/term which can substitute the following statement.
An account that is debited when the partner takes over the asset.
Find the Odd one.
A and B are partners in a firm sharing profits and losses in the ratio of 1:1. C is admitted. A surrenders `1/4`th share and B surrenders `1/5`th of his share in favor of C. Calculate the new profit sharing ratio.
Pramod and Vinod are partners sharing profits and losses in the ratio of 3:2. After the admission of Ramesh the new ratio of Pramod, Vinod and Ramesh is 4:3:2. Find out the sacrifice ratio.
What does the excess of debit over credits in the Profit and Loss Adjustment Account indicate?
The stock showed in Balance Sheet → Stock undervalued by 20% → Cost of Stock
₹1,60,000 → __________→ __________
Vikram and Pradnya share profits and losses in the ratio 2:3 respectively. Their balance sheet as on 31st March 2018 was as under.
Balance Sheet as on 31st March 2018
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| Creditors | 1,05,000 | Cash | 7,500 |
| Capitals: | Land & Building | 37,500 | |
| Vikram | 75,000 | Plant | 45,000 |
| Pradnya | 75,000 | Furniture | 3,000 |
| Stock | 75,000 | ||
| Debtors | 87,000 | ||
| 2,55,000 | 2,55,000 |
They agreed to admit Avani as a partner on 1st April 2018 on the following terms:
- Avani shall have 1/4th share in future profits.
- He shall bring ₹ 37,500 as his capital and ₹ 30,000 as his share of goodwill.
- Land and building to be valued at ₹ 45,000 and furniture to be depreciated by 10%.
- Provision for bad and doubtful debts is to be maintained at 5% on the Sundry Debtors.
- Stocks to be valued ₹ 82,500.
The capital A/c of all partners to be adjusted in their new profit and loss ratio and excess amount be transferred to their loan accounts.
Prepare Profit and Loss Adjustment Account, Capital Accounts, and New Balance Sheet.
Amalendu and Sameer share profits and losses in the ratio 3:2 respectively Their balance sheet as on 31st March 2017 was as under.
Balance Sheet as on 31st March 2017
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| Sundry Creditors | 10,000 | Cash at bank | 12,000 |
| Amlendu capital | 60,000 | Sundry debtors | 24,000 |
| Sameer capital | 40,000 | Land & Building | 50,000 |
| General reserve | 20,000 | Stock | 16,000 |
| Plant and machinery | 20,000 | ||
| Furniture & fixture | 8,000 | ||
| 1,30,000 | 1,30,000 |
On 1st April 2017, they admit Paresh into partnership. The term being that:
- He shall pay ₹16,000 as his share of Goodwill 50% amount of Goodwill shall be withdrawn by the old partners.
- He shall have to bring in ₹ 20,000 as his Capital for 1/4 share in future profits.
- For the purpose of Paresh’s admission, it was agreed that the assets would be revalued as follows.
A) Land and Building is to be valued at ₹ 60,000
B) Plant and Machinery to be valued at ₹ 16,000
C) Stock valued at ₹ 20,000 and Furniture and Fixtures at ₹ 4,000.
D) A Provision of 5% on Debtors would be made for Doubtful Debts.
Pass the necessary Journal Entries in the Books of a New Firm.
Mr. Kishor & Mr. Lal were in partnership sharing profits & losses in the proportion of 3/4 and 1/4 respectively.
| Balance Sheet as on 31 March 2018 | |||||
| Liabilities | Amt (₹) |
Amt (₹) |
Assets | Amt (₹) |
Amt (₹) |
| Creditors | 1,20,000 | Land and Building | 75,000 | ||
| General Reserve | 12,000 | Furniture | 6,000 | ||
| Capital A/c: | Stock | 60,000 | |||
| Kishor | 90,000 | Debtors | 60,000 | ||
| Lal | 48,000 | 1,38,000 | Bills Receivable | 39,000 | |
| Cash at Bank | 30,000 | ||||
| 2,70,000 | 2,70,000 | ||||
They decided to admit Ram on 1 April 2018 on following terms:
1. He should be given 1/5th share in profit and for that he brought in ₹ 60,000 as capital through RTGS.
2. Goodwill should be raised at ₹ 60,000
3. Appreciate Land and Building by 20%
4. Furniture and Stock are to be depreciated by 10%
5. The Capitals of all partners should be adjusted in their new profit sharing ratio through Bank A/c.
Pass necessary Journal Entries in the books of the Partnership firm and a Balance sheet of the new firm.
The balance sheet of Medha and Radha who share profit and loss in the ratio 3: 1 is as follows:
| Balance Sheet as on 31 March 2018 | |||
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| Sundry Creditors | 80,000 | Cash | 78,000 |
| Bills Payable | 20,000 | Sundry debtors | 64,000 |
| Bank overdraft | 20,000 | Stock | 40,000 |
| Capital A/c: | Plant and Machinery | 60,000 | |
| Medha | 1,20,000 | Furniture | 22,000 |
| Radha | 40,000 | Land and Building | 32,000 |
| General reserve | 16,000 | ||
| 2,96,000 | 2,96,000 | ||
They decided to admit krutika on 1st April 2018 on the following terms:
- Krutika is taken as partner on 1st April 2017. She will pay 40,000 as her capital for 1/5th share in future profits and Rs. 2,500 as goodwill.
- A 5% provision for bad and doubtful debt be created on debtors.
- Furniture be depreciated by 20%.
- Stocks be appreciated by 5% and plant and machinery by 20%.
- The Capital accounts of all partners be adjusted in their new profit sharing ratio by adjusting the amount through current account.
- The new profit sharing ratio will be 3/5: 1/5: 1/5 respectively.
You are required to prepare profit and loss adjustment A/c, Partner’s Capital A/c, Balance Sheet of the new firm.
At the time of admission, the goodwill brought by the new partner may be credited to the capital accounts of __________.
State whether the following will be debited or credited in the revaluation account.
- Depreciation on assets
- Unrecorded liability
- Provision for outstanding expenses
- Appreciation of assets
Hari, Madhavan and Kesavan are partners, sharing profits and losses in the ratio of 5 : 3 : 2. As from 1st April 2017, Vanmathi is admitted into the partnership and the new profit sharing ratio is decided as 4 : 3 : 2 : 1. The following adjustments are to be made.
- Increase the value of premises by ₹ 60,000.
- Depreciate stock by ₹ 5,000, furniture by ₹ 2,000 and machinery by ₹ 2,500.
- Provide for an outstanding liability of ₹ 500.
Pass journal entries and prepare a revaluation account.
Seenu and Siva are partners sharing profits and losses in the ratio of 5 : 3. In view of Kowsalya admission, they decided
- To increase the value of building by ₹ 40,000.
- To bring into record investments at ₹ 10,000, which have not so far been brought into account.
- To decrease the value of machinery by ₹ 14,000 and furniture by ₹ 12,000.
- To write off sundry creditors by ₹ 16,000.
Pass journal entries and prepare a revaluation account.
Sai and Shankar are partners, sharing profits and losses in the ratio of 5 : 3. The firm’s balance sheet as on 31st December, 2017, was as follows:
| Liabilities | ₹ | ₹ | Assets | ₹ | ₹ |
| Capital accounts: | Building | 34,000 | |||
| Sai | 48,000 | Furniture | 6,000 | ||
| Shankar | 40,000 | 88,000 | Investment | 20,000 | |
| Creditors | 37,000 | Debtors | 40,000 | ||
| Outstanding wages | 8,000 | Less: Provision for bad debts | 3,000 | 37,000 | |
| Bills receivable | 12,000 | ||||
| Stock | 16,000 | ||||
| Bank | 8,000 | ||||
| 1,33,000 | 1,33,000 |
On 31st December, 2017 Shanmugam was admitted into the partnership for 1/4 share of profit with ₹ 12,000 as capital subject to the following adjustments.
- Furniture is to be revalued at ₹ 5,000 and building is to be revalued at ₹ 50,000.
- Provision for doubtful debts is to be increased to ₹ 5,500
- An unrecorded investment of ₹ 6,000 is to be brought into account
- An unrecorded liability ₹ 2,500 has to be recorded now.
Pass journal entries and prepare the Revaluation Account and capital account of partners after admission.
Amal and Vimal are partners in a firm sharing profits and losses in the ratio of 7 : 5. Their balance sheet as on 31st March, 2019, is as follows:
| Liabilities | ₹ | ₹ | Assets | ₹ |
| Capital accounts: | Land | 80,000 | ||
| Amal | 70,000 | Furniture | 20,000 | |
| Vimal | 50,000 | 1,20,000 | Stock | 25,000 |
| Sundry creditors | 30,000 | Debtors | 30,000 | |
| Profit and loss A/c | 24,000 | Debtors | 19,000 | |
| 1,74,000 | 1,74,000 |
Nirmal is admitted as a new partner on 1.4.2018 by introducing a capital of ₹ 30,000 for 1/3 share in the future profit subject to the following adjustments.
- Stock to be depreciated by ₹ 5,000
- Provision for doubtful debts to be created for ₹ 3,000
- Land to be appreciated by ₹ 20,000
Prepare revaluation account and capital account of partners after admission.
Rajan and Selva are partners sharing profits and losses in the ratio of 3 : 1. Their balance sheet as on 31st March 2017 is as under:
| Liabilities | ₹ | ₹ | Assets | ₹ |
| Capital accounts: | Building | 25,000 | ||
| Rajan | 30,000 | Furniture | 1,000 | |
| Selva | 16,000 | 46,000 | Stock | 20,000 |
| General reserve | 4,000 | Debtors | 16,000 | |
| Creditors | 37,500 | Bills receivable | 3,000 | |
| Cash at bank | 12,500 | |||
| Profit and loss account | 10,000 | |||
| 87,500 | 87,500 |
On 1.4.2017, they admit Ganesan as a new partner on the following arrangements:
- Ganesan brings ₹ 10,000 as capital for 1/5 share of profit.
- Stock and furniture is to be reduced by 10%, a reserve of 5% on debtors for doubtful debts is to be created.
- Appreciate buildings by 20%.
Prepare revaluation account, partners’ capital account and the balance sheet of the firm after admission.
The following is the balance sheet of James and Justina as on 1.1.2017. They share the profits and losses equally
| Liabilities | ₹ | ₹ | Assets | ₹ |
| Capital accounts: | Building | 70,000 | ||
| James | 40,000 | Stock | 30,000 | |
| Justina | 50,000 | 90,000 | Debtors | 20,000 |
| Creditors | 35,000 | Bank | 15,000 | |
| Reserve fund | 15,000 | Prepaid insurance | 5,000 | |
| 1,40,000 | 1,40,000 |
On the above date, Balan is admitted as a partner with a 1/5 share in future profits. Following are the terms for his admission:
- Balan brings ₹ 25,000 as capital.
- His share of goodwill is ₹ 10,000 and he brings cash for it.
- The assets are to be valued as under:
Building ₹ 80,000; Debtors ₹ 18,000; Stock ₹ 33,000
Prepare necessary ledger accounts and the balance sheet after admission.
Anbu and Shankar are partners in a business sharing profits and losses in the ratio of 7 : 5. The balance sheet of the partners on 31.03.2018 is as follows:
| Liabilities | ₹ | ₹ | Assets | ₹ |
| Capital accounts: | Computer | 40,000 | ||
| Anbu | 4,00,000 | Motor car | 1,60,000 | |
| Shankar | 3,00,000 | 7,00,000 | Stock | 4,00,000 |
| Profit and loss | 1,20,000 | Debtors | 3,60,000 | |
| Creditors | 1,20,000 | Bank | 40,000 | |
| Workmen compensation fund | 60,000 | |||
| 10,00,000 | 10,00,000 |
Rajesh is admitted for 1/5 share on the following terms:
- Goodwill of the firm is valued at ₹ 80,000 and Rajesh brought cash ₹ 6,000 for his share of goodwill.
- Rajesh is to bring ₹ 1,50,000 as his capital.
- Motor car is valued at ₹ 2,00,000; stock at ₹ 3,80,000 and debtors at ₹ 3,50,000.
- Anticipated claim on workmen compensation fund is ₹ 10,000
- Unrecorded investment of ₹ 5,000 has to be brought into account.
Prepare revaluation account, capital accounts and balance sheet after Rajesh’s admission.
At the time of admission of a partner, what will be the effect of the following information?
Balance in Workmen compensation reserve ₹40,000. Claim for workmen compensation ₹45,000.
What would be the journal entry of when excess capital was withdrawn by the partner?
A revaluation account is operated to find out the gain or loss at the time of ______
The account which is prepared to adjust the increase or decrease in the value of assets at the time of admission of a partner is called:
Ravi and Gaurav are partners in a firm. They want to admit Dhruv for `1/4`th share in profit. For this, they revalued their machinery from ₹ 30,000 to ₹ 40,000 and creditors from ₹ 1,10,000 to ₹ 1,00,000. What journal entry will be passed:
Which account will be prepared to record the adjusting amount of assets and liabilities?
Karan and Saran are partners in a partnership. They admitted Mohit as a new partner for `1/4`th share in profits.
| Balance Sheet [Extract] | |||
| Liabilities | Amount (₹) |
Assets | Amount (₹) |
| Creditors | 25,000 | ||
If 5% of creditors are not likely to claim their dues, what amount of creditors will be shown in the Balance Sheet on Mohit's admission?
If at the time of admission, there is some unrecorded liability, it will be:
Ram and Shyam were in partnership sharing profits and Losses in the proportion of 3 : 1 respectively. Their Balance sheet as on 31st March, 2020 stood as follows:
| Balance Sheet as on 31st March, 2020 | ||||
| Liabilities | Amount (₹) | Assets | Amount (₹) | |
| Sundry Creditors | 80,000 | Cash | 80,000 | |
| Bills Payable | 42,000 | Sundry Debtors | 64,000 | |
| Capital Accounts: | Land and Building | 32,000 | ||
| Ram | 1,20,000 | 1,60,000 | Stock | 40,000 |
| Shyam | 40,000 | Plant and Machinery | 60,000 | |
| General Reserve | 16,000 | Furniture | 22,000 | |
| 2,98,000 | 2,98,000 | |||
They admit Bharat into partnership on 1st April 2020. The term is that
- He shall have to bring in cash ₹ 40,000 as his Capital for 1/5th share in future profit and ₹ 20,000 as his share of Goodwill.
- A provision for 5% doubtful debts to be created on sundry debtors.
- Stock should be appreciated by 5% and Land and Building be appreciated by 20%.
- Furniture to be depreciated by 20%.
- Capital Accounts of all partners be adjusted in their new profit-sharing ratio through Cash Account.
Prepare:
- Profit and Loss Adjustment Account
- Partners' Capital Account
- Balance Sheet of the new firm.
Navya and Radhey were partners sharing profits and losses in the ratio of 3 : 1. Shreya was admitted for 1/5th share in the profits. Shreya was unable to bring her share of goodwill premium in cash. The journal entry recorded for goodwill premium is given below:
| Date | Particulars | LF | Debit (₹) | Credit (₹) |
| Shreya’s Current A/c Dr. | 24,000 | |||
| To Navya’s Capital A/c | 8,000 | |||
| To Radhey’s Capital A/c | 16,000 | |||
| (Being entry for goodwill treatment passed) |
The new profit-sharing ratio of Navya, Radhey and Shreya will be ______.
Ganga and Jamuna are partners sharing profits in the ratio of 2 : 1. They admit Saraswati for 1/5th share in future profits. On the date of admission, Ganga’s capital was ₹ 1,02,000 and Jamuna’s capital was ₹ 73,000. Saraswati brings ₹ 25,000 as her share of goodwill and she agrees to contribute proportionate capital to the new firm. How much capital will be brought by Saraswati?
The following is the Balance sheet of partners Aditya and Chaitanya on 31st March, 2019 they share profits and losses in the ratio of 3 : 2:
Balance sheet as on 31st march 2019
| Liabilities |
Amount ₹ |
Assets | Amount ₹ |
| Creditors | 60,000 | Building | 30,000 |
| Capital Accounts: | Furniture | 1,800 | |
| Aditya | 42,000 | Machinery | 42,000 |
| Chaitanya | 42,000 | Stock | 24,600 |
| Current Accounts: | Debtors | 54,000 | |
| Aditya | 7,500 | Cash | 6,000 |
| Chaitanya | 6,900 | ||
| 1,58,400 | 1,58,400 |
Adjustments:
They admitted Sachin into partnership on 1st April, 2019 on the following terms:
- Building to be valued at ₹ 36,000, machinery and furniture to be reduced by 10%.
- Sachin should pay ₹ 6,000 as his share of Goodwill. 50% of goodwill withdrawn by partners in cash.
- A provision of 5% on debtors to be made for doubtful debts.
- He should bring ₹ 18,000 as capital for 1/4th share in future profit.
- Stock is to be taken at the value of ₹ 30,000.
Prepare:
- Profit and Loss Adjustment Account.
- Partners’ Current Account.
- Balance Sheet of the New Firm.
Indu, Vijay and Pawan were partners in a firm sharing profits in the ratio of 4 : 3 : 3. They admitted Subhash into partnership with effect from 1st April, 2022. New profit sharing ratio among Indu, Vijay, Pawan and Subhash will be 3: 3: 2: 2. An extract of their Balance Sheet as at 31st March, 2022 is given below:
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| Investment Fluctuation Reserve |
80,000 | Investment (Market Value ₹ 80,000) |
90,000 |
Which of the following is the correct accounting treatment of 'investment fluctuation reserve' at the time of Subhash's admission?
X and Y are partners in a firm with capital of ₹ 18,000 and ₹ 20,000. Z brings ₹ 10,000 for his share of goodwill and he is required to bring proportionate capital for 1/3rd share in profits. The capital contribution of Z will be ______.
Hansa and Kavya share profits and losses in the ratio of 3: 2 respectively. Their Balance Sheet as on 31st March, 2023 was as under:
| Balance Sheet as on 31st March, 2023 | |||
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| Bills Payable | 90,000 | Cash at Bank | 1,500 |
| Reserve fund | 60,000 | Sundry Debtors | 1,33,500 |
| Capital A/c: | Stock | 51,000 | |
| Hansa | 2,16,000 | Furniture | 72,000 |
| Kavya | 1,44,000 | Plant | 1,80,000 |
| Building | 72,000 | ||
| 5,10,000 | 5,10,000 | ||
They admit Munir into partnership on 1-4-2023. The terms being that:
(1) He shall have to bring in ₹ 1,20,000 as his Capital for 1/4th share in future profits.
(2) Value of Goodwill of the firm is to be fixed at the average profits for the last three years.
The Profits were:
| 2019-20 | ₹ 96,000 |
| 2020-21 | ₹ 1,62,000 |
| 2021-22 | ₹ 1,47,000 |
(3) Reserve for Doubtful debts is to be created at ₹ 3,000.
(4) Closing stock is valued at ₹ 45,000.
(5) Plant and Building is to be depreciated by 5%.
Prepare Profit and Loss Adjustment Alc, Capital Accounts of Partners and Balance Sheet of the new firm.
The following is the Balance Sheet of Vivaan and Vihaan sharing Profits and Losses in the ratio of 3 : 2 as on 31 March, 2023.
| Balance Sheet as on 31st March, 2023 | ||||
| Liabilities | Amount (₹) | Assets | Amount (₹) | Amount (₹) |
| Capital Accounts: | Building | 1,08,000 | ||
| Vivaan | 1,20,000 | Plant and Machinery | 90,000 | |
| Vihaan | 1,50,000 | Stock | 72,000 | |
| Sundry Creditors | 90,000 | Debtors | 63,000 | 60,000 |
| Bank Overdraft | 15,000 | Less: R.D .D. | 3,000 | |
| Bank | 30,000 | |||
| Investments | 15,000 | |||
| 3,75,000 | 3,75,000 | |||
On 1-4-2023, Prihaan is admitted on the following terms:
(1) He is to pay ₹ 1,50,000 as his capital and ₹ 60,000 as his share of Goodwill.
(2) The new profit sharing ratio is to be 5 : 3 : 2.
(3) The assets are to be revalued as under:
Building ₹ 1,50,000, Plant and Machinery ₹ 72,000.
(4) R.D.D. to be increased up to ₹ 6,000
(5) The old partners decided to keep half of the amount of goodwill in the business.
(6) Sundry creditors are to be revalued at ₹ 99,000.
Prepare Revaluation Account, Capital Accounts of Partners and Balance Sheet of new [um.
Seeta and Geeta share profits and losses in the ratio of 3:2 in Partnership Firm. Their Balance Sheet as on 31st March, 2020 was as under:
Balance Sheet as on 31st March, 2020
| Liabilities | Amount (₹) | Assets | Amount (₹) | ||
| Capitals: | 40,500 | Bank | 11,250 | ||
| Seeta | 22,500 | Bills Receivable | 5,700 | ||
| Geeta | 18,000 | Debtors | 31,200 | 30,000 | |
| Creditors | 18,750 | (-) R.D.D. | 1,200 | ||
| Biil Payable | 15,000 | Stock | 18,000 | ||
| Bank Loan | 24,000 | Furniture | 7,050 | ||
| General Reserve | 3,750 | Machinery | 7,500 | ||
| Building | 22,500 | ||||
| 1,02,000 | 1,02,000 |
On 1st April, 2020 they admitted Reeta on the following terms:
- For half (1/2) share in future profit Reeta should bring ₹ 15,000 as capital and ₹ 7,500 for goodwill in cash.
- Furniture should be appreciated up to ₹ 8,025 and building be appreciated by 20%.
- R.D.D. is to be maintained at ₹ 1,500.
- The stock is to be reduced by 10% and machinery depreciated by 5%.
- Half of amount of goodwill is withdrawn by old partners.
Pass the necessary Journal Entries in the books of the firm.
