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प्रश्न
Give a word / term / phrase which can substitute the following statements :
The account which shows revaluation of assets and liabilities.
उत्तर
Revaluation or Profit and Loss Adjustment Account
Explanation: The account which shows revaluation of assets and liabilities is called Revaluation or Profit and Loss Adjustment Account. This account records the revised values of assets and liabilities, so that the deceased partner’s heir can be paid his share of profits that the firm has earned till the date of his death.
APPEARS IN
संबंधित प्रश्न
Pass the necessary Journal entries for the following transaction on the dissolution of the firm of P and Q after the various assets (Other than cash) and outside liabilities have been transferred to Realisation Account.
(i) Bank Loan Rs 12,000 was paid.
(ii) Stock worth Rs 16,000 was taken over by Partner Q.
(iii) Partner P paid a creditor Rs 4,000
(iv) An assets not appearing in the books of accounts realized Rs 1,200.
(v) Expenses of realisation Rs 2,000 were paid by partner Q.
(vi) Profit on realization Rs 36,000 was distributed between P and Q in 5 : 4 ratio.
Write the term / word / phrase which can substitute the following statement :
Debit balance of revaluation account.
State whether the following statements is true or false :
Revaluation account is also called Realisation account.
State whether the following statements is true or false :
Profit on revaluation account is transferred to continuing partners’ capital account only.
Why do firm revaluate assets and reassess their liabilities on retirement or on the event of death of a partner?
Digvijay, Brijesh and Parakaram were partners in a firm sharing profits in the ratio of 2:2:1. Their Balance Sheet as on March 31, 2020 was as follows:
| Liabilities | Amt (Rs.) |
Assets | Amt (Rs.) |
| Creditors | 49,000 | Cash | 8,000 |
| Reserves | 18,500 | Debtors | 19,000 |
| Digvijay’s Capital | 82,000 |
Stock |
42,000 |
| Brijesh’s Capital | 60,000 | Buildings | 207,000 |
| Parakaram’s Capital | 75,500 | Patents | 9,000 |
| 2,85,000 | 2,85,000 |
Brijesh retired on March 31, 2020 on the following terms:
- Goodwill of the firm was valued at Rs 70,000 and was not to appear in the books.
- Bad debts amounting to Rs 2,000 were to be written off.
- Patents were considered as valueless.
Prepare Revaluation Account, Partners’ Capital Accounts and the Balance Sheet of Digvijay and Parakaram after Brijesh’s retirement.
Himanshu, Gagan and Naman are partners sharing profits and losses in the ratio of 3:2:1. On March 31, 2019, Naman retires.
The various assets and liabilities of the firm on the date were as follows:
Cash Rs 10,000, Building Rs 1,00,000, Plant and Machinery Rs 40,000, Stock Rs 20,000, Debtors Rs 20,000 and Investments Rs 30,000.
The following was agreed upon between the partners on Naman’s retirement:
|
(i) |
Building to be appreciated by 20%. |
|
(ii) |
Plant and Machinery to be depreciated by 10%. |
|
(iii) |
A provision of 5% on debtors to be created for bad and doubtful debts. |
|
(iv) |
Stock was to be valued at Rs 18,000 and Investment at Rs 35,000. |
Record the necessary journal entries to the above effect and prepare the Revaluation Account.
Select the most appropriate alternative from those given below and rewrite the statement.
The profit or loss from revaluation of assets and liabilities on retirement of a partner is shared by______________
Select the most appropriate alternative from given below and rewrite the statement :
Assets and Liabilities are transferred to Realisation Account at their __________ values.
|
Liabilities
|
Amount
|
Assets
|
Amount
|
|
Capital A/c
|
Building
|
100000
|
|
|
Ganga
|
100000
|
Furniture
|
10000
|
|
Yamuna
|
75000
|
Stock
|
31000
|
|
Creditors
|
10000
|
Debtors 50000
|
|
|
Bills Payable
|
5000
|
Less: R.D.D. -1000
|
49000
|
|
General Reserve
|
15000
|
Bank
|
15000
|
|
205000
|
205000
|
Fill in the blanks:
In case of retirement of a partner, profit or loss on revaluation of assets and re-assessment of liabilities is distributed among _________ partners in ___________ ratio.
Assertion (A): On retirement, of a partner's the old partnership agreement comes to an end and a new partnership agreement comes into existence between the remaining partners.
Reason (R): Retirement of the partnership leads to the reconstitution of the firm.
X, Y and Z were partners. On 30th June 2019 Y retired. The extract of their balance sheet is given below:
| Balance Sheet [An Extract] | |||
| Liabilities | Amount (₹) |
Assets | Amount (₹) |
| Investment Fluctuation Fund | 10,000 | Investments [Market value ₹ 80,000] |
1,00,000 |
What Journal Entry will be passed for the above item on Y's retirement?
At the time of retirement of a partner, profit on revaluation will be credited to the capital accounts of ______.
When the Balance Sheet is prepared after the retirement of a partner (subsequent to the preparation of the Revaluation Account), ______ values are shown in it.
Amay, Bina and Chander are partners in a firm with capital balances of ₹ 50,000, ₹ 70,000 and ₹ 80,000 respectively on 31st March, 2022. Amay decides to retire from the firm on 31st March 2022. With the help of the information provided, calculate the amount to be paid to Amay on his retirement. There existed a general reserve of ₹ 7,500 in the balance sheet on that date. The goodwill of the firm was valued at ₹ 30,000. Gain on revaluation was ₹ 24,000.
P, Q and R were partners in a firm sharing profits and losses in the ratio of 4 : 3 : 3. On 31.3.2020 R retired from the firm. On R's retirement the balance sheet of the firm showed sundry debtors at t 3,75,000. It was decided to write off ₹ 5,000 as bad debts and create a provision of 20% on debtors for bad and doubtful debts. Pass necessary journal entries for the above transactions in the books of the firm on R's retirement.
D, E and F were partners in a firm sharing profits in the ratio of 5 : 2 : 3. On 31.3.2022 their balance sheet was as follows:
| Liabilities | Amount (₹) | Amount (₹) | Assets | Amount (₹) |
| Creditors | 53,000 | Cash | 16,000 | |
| Bills Payable | 62,000 | Bank | 17,000 | |
| General Reserve | 2,00,000 | Stock | 18,000 | |
| Capitals: | Debtors | 1,99,000 | ||
| D | 7,00,000 | 18,00,000 | Investments | 1,15,000 |
| E | 5,00,000 | Machinery | 7,50,000 | |
| F | 6,00,000 | Land and Building |
10,00,000 | |
| 21,15,000 | 21,15,000 |
On the above date D retired from the firm and the following was agreed upon:
- Goodwill of the firm was valued at ₹ 1,00,000, D's share of goodwill was adjusted through the capital accounts of remaining partners.
- Investments were to be brought to their market value which was ₹ 85,000.
- Machinery was to be depreciated to ₹ 7,00,000.
- Land and Building was to be appreciated to ₹ 12,00,000.
- The balance in D's capital account was transferred to his loan account.
Prepare Revaluation Account and D's Capital Account on his retirement.
X, Y and Z were partners in a firm sharing profit and losses in the ratio of 5 : 3 : 2. On 31.3.2022 X retired from the firm. On X's retirement the firm had a balance of ₹ 90,000 in the General Reserve Account. The revaluation of assets and reassessment of liabilities resulted in a loss of ₹ 70,000. Pass necessary journal entries for the above transactions on X's retirement.
Himanshu, Gagan, and Naman are partners who share profits and losses in the ratio of 3: 2: 1. On March 31, 2017, Naman retired. The firm's various assets and liabilities on that date were as follows:
Cash Rs. 10,000, Building Rs. 1,00,000, Plant and Machinery Rs. 40,000, Stock Rs. 20,000, Debtors Rs. 20,000, and Investments Rs. 30,000.
The following was agreed upon between the partners on Naman’s retirement:
- Building to be appreciated by 20%.
- Plant and Machinery to be depreciated by 10%.
- A provision of 5% on debtors to be created for bad and doubtful debts.
- Stock was to be valued at Rs. 18,000 and Investment at Rs. 35,000.
Record the necessary journal entries to the above effect and prepare the revaluation account.
Digvijay, Brijesh and Parakaram were partners in a firm sharing profits in the ratio of 2 : 2 : 1. Their Balance Sheet as on March 31, 2007, was as follows:
| Liabilities | ₹ | Assets | ₹ |
| Creditors | 49,000 | Cash | 8,000 |
| Reserves | 18,500 | Debtors | 19,000 |
| Digvijay's Capital | 82,000 | Stock | 42,000 |
| Brijesh's Capital | 60,000 | Buildings | 2,07,000 |
| Parakaram's Capital | 75,500 | Patents | 9,000 |
| 2,85,000 | 2,85,000 |
Brijesh retired on March 31, 2007, on the following terms:
- Goodwill of the firm was valued at Rs. 70,000 and was not to appear in the books.
- Bad debts amounting to Rs. 2,000 were to be written off.
- Patents were considered as valueless.
Prepare Revaluation Account, Partners’ Capital Accounts and the Balance Sheet of Digvijay and Parakaram after Brijesh’s retirement.
