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प्रश्न
Suresh, Naresh and Paresh were equal partners. On 31st March, 2019 their Balance sheet was as follows:
| Balance Sheet as on 31st March, 2019 | |||
| Liabilities | Amount (₹) |
Assets | Amount (₹) |
| Capital Accounts: | Land and Building | 2,00,000 | |
| Suresh | 2,50,000 | Furniture | 1,50,000 |
| Naresh | 1,00,000 | Debtors | 1,50,000 |
| Paresh | 1,00,000 | Cash | 1,00,000 |
| Sundry creditors | 1,50,000 | ||
| 6,00,000 | 6,00,000 | ||
Suresh died on 30th June, 2019 and the following adjustments were agreed as:
- Furniture was to be adjusted to its market price of ₹ 1,70,000.
- Land and building was to be depreciated by 10%.
- Provide R.D.D. at 5% on debtors.
- The profit up to the date of death of Suresh is to be calculated on the basis of average profit of last year which was ₹ 90,000.
Prepare:
- Profit and loss adjustment account.
- Partners’ capital account.
- Balance sheet of the continuing firm.
उत्तर
| Dr. | In the books of the Partnership Firm Profit and Loss Adjustment Account |
Cr. | |||||
| Particulars | Amount (₹) |
Particulars | Amount (₹) |
Amount (₹) |
|||
| To Land and Building A/c | 20,000 | By Furniture A/c | 20,000 | ||||
| To R.D.D. A/c | 7,500 | By Partners’ Capital A/c (Loss) | |||||
| Suresh | 2,500 | 7,500 | |||||
| Naresh | 2,500 | ||||||
| Paresh | 2,500 | ||||||
| 27,500 | 27,500 | ||||||
| Dr. | Partners’ Capital Account | Cr. | |||||||
| Particulars | Suresh (₹) | Naresh (₹) | Paresh (₹) | Particulars | Suresh (₹) | Naresh (₹) | Paresh (₹) | ||
| To Profit and Loss Adjustment A/c - Loss | 2,500 | 2,500 | 2,500 | By Balance b/d | 2,50,000 | 1,00,000 | 1,00,000 | ||
| To Suresh's Executor’s A/c | 2,55,000 | - | - | By Profit and Loss Suspense A/c | 7,500 | - | - | ||
| To Balance c/d | - | 97,500 | 97,500 | ||||||
| 2,57,500 | 1,00,000 | 1,00,000 | 2,57,500 | 1,00,000 | 1,00,000 | ||||
| Balance Sheet as on 30th June 2019 | |||||
| Liabilities | Amount (₹) | Amount (₹) | Assets | Amount (₹) | Amount (₹) |
| Capital Accounts: | 1,95,000 | Land and Building | 2,00,000 | 1,80,000 | |
| Naresh | 97,500 | Less: Depreciation | 20,000 | ||
| Paresh | 97,500 | Furniture | 1,50,000 | 1,70,000 | |
| Suresh's Executor’s A/c | 2,55,000 | Add: Appreciation | 20,000 | ||
| Sundry creditors | 1,50,000 | Debtors | 1,50,000 | 1,42,500 | |
| Less: R.D.D. (5%) | 7,500 | ||||
| Cash | 1,00,000 | ||||
| Profit and Loss Suspense A/c | 7,500 | ||||
| 6,00,000 | 6,00,000 | ||||
Working Note:
1. Profit upto the date of death of Suresh = (Average Profit) x (Proportionate Period)
= `90,000 xx 3/12`
= ₹ 22,500
2. Suresh's share in profit = (Proportionate Profit) x (Suresh's share)
= `22,500 xx 1/3`
= ₹ 7,500
Suresh's share in profit is debited to Profit and Loss Suspense Ale and credited to Suresh's Capital A/c.
3. R.D.D = 5% of Debtors = `5/100 xx 1,50,000`
= ₹ 7,500
4. The amount due to Suresh is transferred to his Executor's Loan A/c.
APPEARS IN
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| Balance Sheet as on 31st March 2019 | |||
| Liabilities | Amount ₹ | Assets | Amount ₹ |
| Capital Account : | Land and Building | 4,00,000 | |
| Rajesh | 5,00,000 | Furniture | 3,00,000 |
| Rakesh | 2,00,000 | Debtors | 3,00,000 |
| Mahesh | 2,00,000 | Stock | 1,00,000 |
| Sundry creditors | 90,000 | Cash | 1,00,000 |
| Bills Payable | 60,000 | ||
| Bank loan | 1,50,000 | ||
| 12,00,000 | 12,00,000 | ||
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1) Furniture was to be adjusted to its market price of 3,40,000
2) Land and Building was to be depreciated by 10%
3) Provide R.D.D 5% on debtors
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| Balance Sheet as on 31st March 2017 | ||||
| Liabilities | Amount (₹) | Assets | Amount (₹) | |
| Capital Account: | Debtors | 1,00,000 | ||
| Rahul | 2,20,000 | Less: R.D.D. | 10,000 | 90,000 |
| Rohit | 2,10,000 | Plant and Machinery | 85,000 | |
| Ramesh | 2,40,000 | Investment | 3,50,000 | |
| Creditors | 80,000 | Motor lorry | 1,00,000 | |
| Bills Payable | 7,000 | Building | 80,000 | |
| General Reserve | 96,000 | Bank | 1,48,000 | |
| 8,53,000 | 8,53,000 | |||
On 1st October 2017, Ramesh died and the Partnership deed provided that
- R.D.D. was maintained at 5% on Debtors
- Plant and Machinery and Investment were valued at ₹ 80,000 and ₹ 4,10,000 respectively.
- Of the creditors, an item of ₹ 6000 was no longer a liability and hence was properly adjusted.
- Profit for 2017-18 was estimated at ₹ 120,000 and Ramesh share in it up to the date of his death was given to him.
- Goodwill of the Firm was valued at two times the average profit of the last five years. Which were
Ramesh share in it was to be given to him2012-13 ₹ 1,80,000 2013-14 ₹ 2,00,000 2014-15 ₹ 2,50,000 2015-16 ₹ 1,50,000 2016-17 ₹ 1,20,000 - Salary 5,000 p.m. was payable to him
- Interest on capital at 5% i.e. was payable and on Drawings ₹ 2000 were charged.
- Drawings made by Ramesh up to September 2017 were ₹ 5,000 p.m.
Prepare Ramesh’s Capital A/c showing the amount payable to his executors
Give Working of Profit and Goodwill
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Ram, Madhav, and Keshav are partners sharing Profit and Losses in the ratio 5:3:2 respectively. Their Balance Sheet as on 31st March 2018 was as follows.
| Balance Sheet as on 31st March 2018 | |||
| Liabilities | Amount ₹ | Assets | Amount ₹ |
| General Reserve | 25,000 | Goodwill | 50,000 |
| Creditors | 1,00,000 | Loose Tools | 50,000 |
| Unpaid Rent | 25,000 | Debtor | 1,50,000 |
| Capital Accounts | - | Live Stock | 1,00,000 |
| Ram | 100000 | Cash | 25,000 |
| Madhav | 75000 | ||
| Keshav | 50000 | ||
| 3,75,000 | 3,75,000 | ||
Keshav died on 31st July 2018 and the following Adjustment were agreed by as per partnership deed.
1. Creditors have increased by 10,000
2. Goodwill is to be calculated at 2 years purchase of average profits of 5 years.
3. The Profits of the preceding 5 years was
| 2013-14 | ₹ 90,000 |
| 2014-15 | ₹ 1,00,000 |
| 2015-16 | ₹ 60,000 |
| 2016-17 | ₹ 50,000 |
| 2017-18 | ₹ 50,000 (Loss) |
Keshav's share in it was to be given to him.
4. Loose Tools and livestock were valued at ₹ 80,000 and ₹ 1,20,000 respectively
5. R.D.D. was maintained at ₹ 10,000
6. Commission's ₹ 2000 p.m. was payable to Keshav Profit for 2018 -19 was estimated at ₹ 45000 and Keshav's share in it up to the date of his death was given to him.
Prepare
Revaluation A/c, Keshav’s capital A/c showing the amount payable to his executors.
The Balance Sheet of Sohan, Rohan and Mohan who were sharing profits and Losses in the ratio of 3:2:1 as follows.
| Balance Sheet as on 31st March 2019 | |||
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| Bank Overdraft | 18,000 | Bank | 48,000 |
| Creditors | 85,000 | Debtors | 30,000 |
| Bills payable | 40,000 | Land and Building | 40,000 |
| Bank Loan | 1,50,000 | Machinery | 80,000 |
| General Reserve | 27,000 | Investments | 40,000 |
| Capital Account: | Computers | 40,000 | |
| Sohan | 20,000 | Stock | 90,000 |
| Rohan | 20,000 | Patents | 12,000 |
| Mohan | 20,000 | ||
| 3,80,000 | 3,80,000 | ||
Mr. Rohan died on 1st October 2019 and the following adjustments were made.
- Goodwill of the firm is valued at ₹ 30,000.
- Land and Building and Machinery were found to be undervalued by 20%.
- Investments are valued at ₹ 60,000
- Stock to be undervalued by ₹ 5000 and a provision of 10% as debtors were required.
- Patents were valueless.
- Mr. Rohan was entitled to share in profits up to the date of death and it was decided that he may be allowed to retain his drawings as his share of profit. Rohan’s drawings till the date of death was ₹ 25000.
Prepare Partners' capital accounts.
The following is the Balance Sheet of Shikha, Divit and Naman, who were partners sharing profits and losses in the ratio of 2 : 2 : 1.
| Balance sheet as on 31st March 2020 | |||||
| Liabilities | Amount (₹) | Amount (₹) | Assets | Amount (₹) | Amount (₹) |
| Capital A/cs: | Investment | 1,40,000 | |||
| Shikha | 80,000 | 2,20,000 | Stock | 48,000 | |
| Divit | 60,000 | Debtors | 81,600 | 80,000 | |
| Naman | 80,000 | Less: R.D.D. | 1,600 | ||
| Creditors | 48,000 | Cash | 12,000 | ||
| Outstanding Salaries | 12,000 | ||||
| 2,80,000 | 2,80,000 | ||||
Naman died on 1st July, 2020 and the following adjustment were made in the books of the firm:
(1) All debtors were considered as good and the Reserve for Doubtful Debts was no longer necessary.
(2) A contingent liability for compensation of ₹ 3,600 was to be provided.
(3) Investment worth ₹ 80,000 were taken over by the executor of Naman and the remaining investments were sold ₹ 60,000.
(4) Stock was revalued at ₹ 60,000.
(5) The goodwill of the firm was valued at ₹ 40,000 and was to be shown in the books.
(6) The deceased partner's share in profit up to the date of his death was to be calculated on the basis of the preceding year's profit which was ₹ 32,000.
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Prem, Verma, Sharma, were partners sharing profits and losses in the ratio 2: 1: 1 Their Balance Sheet as on 31st March 2019 is as follows.
| Balance Sheet as on 31st March, 2019 | |||
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| Creditors | 20,000 | Premises | 2,40,000 |
| Bank Loan | 90,000 | Debtors | 2,00,000 |
| Bill Payable | 10,000 | Furniture | 60,000 |
| General Reserve | 64,000 | Stock | 1,00,000 |
| Capital Accounts: | Cash | 2,00,000 | |
| Prem | 2,40,000 | ||
| Verma | 2,00,000 | ||
| Sharma | 1,76,000 | ||
| 8,00,000 | 8,00,000 | ||
- Prem died on 30th June 2019 and the following adjustments were made Prem’s share of profit is to be calculated on the average profit of the last two years.
- Prem’s share in the Goodwill of the firm be given him. Goodwill will be valued at three times of the average profits of the last four years. The profits were.
2015-16 ₹ 1,60,000 2016-17 ₹ 1,20,000 2017-18 ₹ 80,000 2018-19 ₹ 40,000 - Premises be valued at ₹ 2,80,000 and R.D.D. of ₹ 8,000 be created on debtors.
- Drawing of Prem up to the date of his death were ₹ 15000 per month.
- Interest on capital is allowed at 10% p.a. and to be charged on drawing at ₹ 4000.
- The amount due to Prem be transferred to his executors loan account.
Prepare: Prem’s Capital Account, Give working of Prem’s share in Goodwill, and Interest on capital.
Arun, Varun and Karun were partners in a business sharing profits and losses in the ratio of 2 : 2: 1 respectively. Their Balance sheet as on 31st March, 2019 was as under :
| Balance Sheet as on 31st March,2019 | ||||
| Liabilities | Amount ₹ | Assets | Amount ₹ | |
| Capital Account: | Land and Building | 27,900 | ||
| Arun | 20,000 | Investment | 15,000 | |
| Varun | 20,000 | Furniture | 8,000 | |
| Karun | 10,000 | Debtors | 10,400 | 10,000 |
| Creditors | 16,000 | Less: R.D.D | 400 | |
| Bank Loan | 4,000 | Bank | 4,100 | |
| Goodwill | 5,000 | |||
| 70,000 | 70,000 | |||
On 1st July, 2019 Karun died and the following adjustments were made:
- All the debtors were considered as good.
- Bank Loan were paid off.
- Furniture was depreciated by ₹ 550.
- Investments were sold out in the Market at 10% profit.
- Goodwill of the firm was valued at ₹ 7,500. It was to be raised in the books.
- Karun was entitled to get his share in the profit up to the date of his death. Profit for 2019-2020 was estimated at ₹ 5,000.
- The amount due to Karun’s Executor was paid by NEFT.
Prepare:
- Profit and Loss Adjustment A/c.
- Partners’ Capital Account.
- Balance sheet of New Firm.
Shah, Patel, Bhide were partners in a business sharing profits and losses in the ratio of 2 : 1 : I respectively. Their Balance sheet as on 31st March 2022 was as follows:
| Balance Sheet as on 31-03-2022 | |||
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| Capital A/c: | Plant & Machinery | 84,000 | |
| Shah | 84,000 | Debtors | 70,000 |
| Patel | 98,000 | Furniture | 42,000 |
| Bhide | 47,600 | Bank | 84,000 |
| Creditors | 25,200 | ||
| Bills Payable | 2,800 | ||
| General Reserve | 22,400 | ||
| 2,80,000 | 2,80,000 | ||
Bhide died on 1st July, 2022:
(1) Plant and Machinery was to be revalued to ₹ 98,000 and R.D.D. is to be created of ₹ 2,800.
(2) The drawings of Bhide up to the date of his death amounted to ₹ 14,000.
(3) Charge interest on drawings ₹ 1,400.
(4) His share of goodwill should be calculated at three year purchase of the profits for the last four years which were I year ₹ 2,30,000, II year ₹ 1,82,000, III year ₹ 98,000, IV ₹ 70,000.
(5) The deceased partner's share of profit up to the date of death to be calculated on the basis of average profit of last two years (III & IV year).
Prepare: Profit and Loss Adjustment Account, Partner's Capital Accounts, Balance Sheet of the continuing firm. Give working note of profit up to the date of death of Bhide and Goodwill.
A person who died is known as ______.
Het, Heet and Hari are partners sharing profits and losses in the ratio 5 : 3 : 2 respectively. Their Balance Sheet as on 31st March, 2023 was as follows:
| Balance Sheet as on 31st March, 2023 | |||
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| General Reserve | 35,000 | Goodwill | 70,000 |
| Creditors | 1,40,000 | Loose Tools | 70,000 |
| Unpaid Rent | 35,000 | Debtors | 2,10,000 |
| Capital Accounts: | Livestock | 1,40,000 | |
| Het | 1,40,000 | Cash | 35,000 |
| Heet | 1,05,000 | ||
| Hari | 70,000 | ||
| 5,25,000 | 5,25,000 | ||
Hari died on 3lst July, 2023 and the following adjustments were agreed by as per partnership deed:
(1) Creditors have increased by ₹ 14,000.
(2) Goodwill is to be calculated at 2 years purchase of average profits of 5 years.
(3) The profits of the preceding 5 years was
| 2018-19 | ₹ 1,26,000 |
| 2019-20 | ₹ 1,40,000 |
| 2020-21 | ₹ 84,000 |
| 2021-22 | ₹ 70,000 |
| 2022-23 | ₹ 70,000 (Loss) |
Hari's share in it was to be given to him.
(4) Loose Tools and Livestock were valued at ₹ 1,12,000 and ₹ 1,68,000 respectively.
(5) R.D.D. was maintained at ₹ 14,000.
( 6) Commission ₹ 2,800 p.m. was payable to Hari. Profit for 2023-24 was estimated at ₹ 63,000 and Bari's share in it up to the date of his death was given to him.
Prepare Revaluation Ale, Bari's Capital Ale showing the amount payable to his executors.
The Balance Sheet of Karma, Punya and Bandhan who were sharing Profits and Losses in the ratio of 3 : 2 : 1 is as follows:
| Balance Sheet as on 31st March, 2022 | |||
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| Bank Overdraft | 27,000 | Bank | 72,000 |
| Creditors | 1,27,500 | Debtors | 45,000 |
| Bills Payable | 60,000 | Land and Building | 60,000 |
| Bank Loan | 2,25,000 | Machinery | 1,20,000 |
| General Reserve | 40,500 | Investments | 60,000 |
| Capital Accounts: | Computers | 60,000 | |
| Karma | 30,000 | Stock | 1,35,000 |
| Punya | 30,000 | Patents | 18,000 |
| Bandhan | 30,000 | ||
| 5,70,000 | 5,70,000 | ||
Punya died on 1st October, 2022 and the following adjustments were made:
(1) Goodwill of the firm is valued at ₹ 45,000.
(2) Land & Building and Machinery were found to be undervalued by 20%.
(3) Investments are valued at ₹ 90,000.
(4) Stock to be undervalued by ₹ 7,500 and a provision of 10% as Debtors was required.
(5) Patents were valueless.
(6) Punya was entitled to share in profits up to the date of death and it was decided that he may be allowed to retain his drawings as his share of profit. Punya's drawings till date of death was ₹ 37,500.
Prepare Partner's Capital Accounts.
