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Tamil Nadu Board of Secondary EducationHSC Commerce Class 12

Roja, Neela and Kanaga are partners sharing profits and losses in the ratio of 4:3:3. On 1st April 2017, Roja retires and on retirement, the following adjustments are agreed upon: - Accountancy

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Question

Roja, Neela and Kanaga are partners sharing profits and losses in the ratio of 4:3:3. On 1st April 2017, Roja retires and on retirement, the following adjustments are agreed upon:

  1. Increase the value of building by ₹ 30,000.
  2. Depreciate stock by ₹ 5,000 and furniture by ₹ 12,000.
  3. Provide an outstanding liability of ₹ 1,000.

Pass journal entries and prepare revaluation account.

Journal Entry
Ledger

Solution

Dr. Revaluation Account Cr.
Particulars Particulars
To Stock 5,000 By Buildings A/c 30,000
To Furniture 12,000    
To Outstanding liability 1,000    
To Profit on revaluation
transferred to
     
Roja 4,800 12,000    
Neela 3,600    
Kanaga 3,600    
  30,000   30,000

Journal Entries

Particulars Debit ₹ Credit ₹
Revaluation A/c  Dr.
    To Stock A/c
    To Furniture A/c
    To Outstanding liability A/c
(Decrease in value of assets)
18,000 5,000
12,000
1,000
Buildings A/c  Dr.
   To Revaluation A/c
(Value of building increases)
30,000 30,000
Revaluation A/c  Dr.
  To Roja's Capital A/c
  To Neela's Capital A/c
  To Kanaga's Capital A/c
(Profit on revaluation account)
12,000 4,800
3,600
3,600
shaalaa.com
Revaluation of Assets and Liabilities
  Is there an error in this question or solution?
Chapter 6: Retirement and death of a partner - Exercises [Page 217]

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Samacheer Kalvi Accountancy [English] Class 12 TN Board
Chapter 6 Retirement and death of a partner
Exercises | Q IV 4. | Page 217
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