Question 41: Chintan and Ayush are partners in a firm sharing profits and losses in the ratio of 3:2. They admitted Sudha as a new partner for 1/10th share in profits. Sudha brings ` 40,000 as premium for goodwill out of his share of `70,000. Goodwill already appears in the books at ` 40,000.
Pass the necessary Journal entries to record this arrangement in the follow will two cases:
Case 1. When the unpaid share of goodwill is adjusted through New Partner's Current A/c.
Case 2. When goodwill is raised for the amount not brought by the new partner and is also written off.
Answer:
Case 1. When the
unpaid share of goodwill is adjusted through New Partner's Current A/c
|
Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit ` |
Credit ` |
|
|
|
|
|
|
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|
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Chintan's Capital A/c |
Dr. |
|
24,000 |
|
|
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Ayush's Capital A/c |
Dr. |
|
16,000 |
|
|
|
To Goodwill A/c |
|
|
|
40,000 |
|
|
(Being old value of Goodwill written off) |
|
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|
|
|
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Bank A/c |
Dr. |
|
40,000 |
|
|
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To Premium for goodwill A/c |
|
|
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40,000 |
|
|
(Being Premium for Goodwill brought.) |
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|
|
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Sudha's Current A/c |
Dr. |
|
30,000 |
|
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Premium for goodwill A/c A/c |
Dr. |
|
40,000 |
|
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To Chintan's Capital A/c |
|
|
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42,000 |
|
|
To Ayush's Capital A/c (Being Goodwill Raised) |
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|
28,000 |
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|
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|
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|
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|
Note: Unless otherwise stated, sacrificing ratio is the same as old profit-sharing ratio.
Case 2. When goodwill
is raised for the amount not brought by the new partner and is also written
off.
|
Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit ` |
Credit ` |
|
|
|
|
|
|
|
|
|
|
Chintan's Capital A/c |
Dr. |
|
24,000 |
|
|
|
Ayush's Capital A/c |
Dr. |
|
16,000 |
|
|
|
To Goodwill A/c |
|
|
|
40,000 |
|
|
(Being old value of Goodwill written off) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Bank A/c |
Dr. |
|
40,000 |
|
|
|
To Premium for goodwill A/c |
|
|
|
40,000 |
|
|
(Being Premium for Goodwill brought.) |
|
|
|
|
|
|
|
|
|
|
|
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|
Premium for goodwill A/c A/c |
Dr. |
|
40,000 |
|
|
|
To Chintan's Capital A/c |
|
|
|
24,000 |
|
|
To Ayush's Capital A/c (Being Premium for Goodwill transferred to sacrificing partners) |
|
|
16,000 |
|
|
|
Goodwill A/c |
Dr. |
|
3,00,000 |
|
|
|
To Chintan's Capital A/c |
|
|
|
1,80,000 |
|
|
To Ayush's Capital A/c (Being Goodwill Raised for remaining share of goodwill not brought by Sudha) |
|
|
|
1,20,000 |
|
|
Chintan's Capital A/c |
Dr. |
|
1,62,000 |
|
|
|
Ayush's Capital A/c |
Dr. |
|
1,08,000 |
|
|
|
Sudha’s Capital A/c |
Dr. |
|
30,000 |
|
|
|
To Goodwill A/c |
|
|
|
|
|
|
(Being old value of Goodwill written off) |
|
|
|
3,00,000 |
|
|
|
|
|
|
|
Note: Unless otherwise stated, sacrificing ratio is the same as old profit-sharing ratio.
Question 42:
Arun and Vijay are partners in a firm sharing profit & loss in the ratio of 3: 2.
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BALANCE SHEET (Extract) |
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|
Liabilities |
` |
Assets |
` |
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|
Machinery |
2,00,000 |
If the value of machinery in the Balance Sheet is excess by 33 1/3, find the value of machinery to be shown in the New Balance Sheet.
Answer:
If the value of machinery in the Balance Sheet is excess by 33 1/3
Then the book value is 100+33 1/3= 133 1/3
Excess Value of Machinery is 2,00,000×33 1/3 ÷ 133 1/3
Or
= 2,00,000×100/3 ×3/400 = 50,000
Value of machinery to be shown in the New Balance Sheet = 2,00,000-50,000= 1,50,000
Question 43: Pass
entries in the firm's Journal for the following on admission of a partner:
(i) Machinery be reduced by 16,000 and Building be appreciated by 40,000.
(ii) A provision be created for Doubtful Debts @ 5% of Debtors amounting to 80,000.
(iii) Provision for warranty claims be increased by 12,000.
(iv) Furniture (Book Value 50,000) is to be reduced by 40%.
(v) Furniture (Book Value 50,000) is to be reduced to 40%.
Answer:
|
Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit ` |
Credit ` |
|
|
(i) |
|
|
|
|
|
|
a. |
Revaluation A/c |
Dr. |
|
16,000 |
|
|
To Machinery A/c |
|
|
|
16,000 |
|
|
|
(Being Machinery be reduced) |
|
|
|
|
|
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|
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|
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|
b. |
Building A/c |
Dr. |
|
40,000 |
|
|
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To Revaluation A/c |
|
|
|
40,000 |
|
|
(Being Building be appreciated) |
|
|
|
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(ii) |
|
|
|
|
|
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Revaluation A/c |
Dr. |
|
4,000 |
|
|
|
To Provision for Doubtful Debts A/c |
|
|
|
4,000 |
|
|
(Being provision be created for Doubtful Debts @ 5% of Debtors amounting to 80,000) |
|
|
|
|
|
(iii) |
Revaluation A/c |
Dr. |
|
12,000 |
|
|
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To Provision for Warranty Claims A/c |
|
|
|
12,000 |
|
|
(Being Provision for warranty claims be increased) |
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|
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(iv) |
Revaluation A/c |
Dr. |
|
20,000 |
|
|
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To Furniture A/c |
|
|
|
20,000 |
|
|
(Being Furniture (Book Value 50,000) is to be reduced by 40%) |
|
|
|
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|
(v) |
Revaluation A/c |
Dr. |
|
30,000 |
|
|
|
To Furniture A/c |
|
|
|
30,000 |
|
|
(Being Furniture (Book Value 50,000) is to be reduced to 40%) |
|
|
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Question 44:
Pass entries in firm's Journal for
the following on admission of a partner:
(i) Unrecorded Investments worth `20,000 are to be
accounted.
(ii) Unrecorded liability towards suppliers for ` 5,000 is to be accounted.
(iii) An item of `
1,600 included in Sundry Creditors is not likely to be claimed and hence should
be written back.
Answer:
|
Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit ` |
Credit ` |
|
|
|
|
|
|
|
|
|
(i) |
Investment A/c |
Dr. |
|
20,000 |
|
|
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To Revaluation A/c |
|
|
|
20,000 |
|
|
(Investments
recorded) |
|
|
|
|
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|
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(ii) |
Revaluation A/c |
Dr. |
|
5,000 |
|
|
|
To Creditors A/c |
|
|
|
5,000 |
|
|
(Liability
recorded) |
|
|
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|
|
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|
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(iii) |
Creditors A/c |
|
|
|
|
|
|
To Revaluation A/c |
Dr |
|
1,600 |
|
|
|
(Liability
decreased) |
|
|
|
1,600 |
|
|
|
|
|
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Question 45:
X and Y are partners
in a firm sharing profits in the ratio of 3 : 2. They
admitted Z as a partner and fixed the new profit-sharing ratio as 3 : 2 : 1. At the time of admission of Z, Debtors
and Provision for Doubtful Debts appeared at `50,000 and `5,000 respectively all
debtors are good. Pass the necessary Journal entries.
Answer:
|
Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit ` |
Credit ` |
|
|
|
|
|
|
|
|
|
(i) |
Provision for
Doubtful Debts A/c |
Dr. |
|
5,000 |
|
|
|
To Revaluation A/c |
|
|
|
5,000 |
|
|
(Provision on
Debtors reduced) |
|
|
|
|
|
|
|
|
|
|
|
|
(ii) |
Revaluation A/c |
Dr. |
|
5,000 |
|
|
|
To
X’s Capital A/c |
|
|
|
3,000 |
|
|
To
Y’s Capital A/c |
|
|
|
2,000 |
|
|
(Profit on
Revaluation transferred to Partners’ Capital A/c) |
|
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Ts Grewal Solution 2023-2024
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Class 12 / Volume – I