Question 61:
The Balance Sheet of Madhu and Vidhi who are sharing profits in the ratio of 2 : 3 as at 31st March, 2016 is given below:
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|
|||||
|
Liabilities |
` |
Assets |
` |
||
|
Madhu's
Capital |
5,20,000 |
Land
and Building |
3,00,000 |
||
|
Vidhi's
Capital |
3,00,000 |
Machinery |
2,80,000 |
||
|
General
Reserve |
30,000 |
Stock |
80,000 |
||
|
Bills
Payable |
1,50,000 |
Debtors |
3,00,000 |
|
|
|
|
|
|
Less:
Provision |
10,000 |
2,90,000 |
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|
|
|
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|
|
|
|
|
|
Bank |
50,000 |
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|
|
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||
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|
|
||
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|
10,00,000 |
|
10,00 ,000 |
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||
Madhu and Vidhi decided to admit Gayatri as a new partner from 1st April, 2016
and their new profit-sharing ratio will be 2 : 3 : 5. Gayatri
brought ` 4,00,000 as her capital and her share of goodwill
premium in cash.
(a) Goodwill of the firm was valued at
` 3,00,000.
(b) Land and Building was found undervalued by ` 26,000.
(c) Provision for doubtful debts was to be made equal to 5% of the
debtors.
(d) There was a claim of ` 6,000 on account of workmen compensation.
Prepare Revaluation Account, Partners' Capital Accounts and the Balance Sheet
of the reconstituted firm.
Answer:
|
Revaluation Account |
|||||||
|
Dr. |
|
Cr. |
|||||
|
Particulars |
` |
Particulars |
` |
||||
|
Provision for Doubtful Debts |
5,000 |
Land &Building |
26,000 |
||||
|
Claim against Workmen Compensation |
6,000 |
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|
||||
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Revaluation Profit |
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|
|
||||
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Madhu’s Capital |
6,000 |
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|
|
||
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|
Vidhi’s Capital |
9,000 |
15,000 |
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|
||
|
|
26,000 |
|
26,000 |
||||
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|
||||
|
Partners’
Capital Account |
||||||||
|
Dr. |
Cr. |
|||||||
|
Particulars |
Madhu |
Vidhi |
Gayatri |
Particulars |
Madhu |
Vidhi |
Gayatri |
|
|
Balance
c/d |
5,98,000 |
4,17,000 |
4,00,000 |
Balance
b/d |
5,20,000 |
3,00,000 |
|
|
|
|
|
|
|
Bank |
|
|
4,00,000 |
|
|
|
|
|
|
General
Reserve |
12,000 |
18,000 |
|
|
|
|
|
|
|
Premium
for Goodwill |
60,000 |
90,000 |
|
|
|
|
|
|
|
Revaluation |
6,000 |
9,000 |
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|
|
|
|
|
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|
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|
|
|
5,98,000 |
4,17,000 |
4,00,000 |
|
5,98,000 |
4,17,000 |
4,00,000 |
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|
Balance Sheet as on March 31,
2016 |
|||||
|
Liabilities |
` |
Assets |
` |
||
|
Bills Payable |
1,50,000 |
Bank (50,000 + 4,00,000 +
1,50,000) |
|
6,00,000 |
|
|
Claim for Workmen
Compensation |
6,000 |
Sundry Debtors |
3,00,000 |
|
|
|
Capital: |
|
Less: Provision for Doubtful
Debt |
15,000 |
2,85,000 |
|
|
Madhu |
5,98,000 |
|
Stock |
80,000 |
|
|
Vidhi |
4,17,000 |
|
Machinery |
2,80,000 |
|
|
Gayatri |
4,00,000 |
14,15,000 |
Land &Building |
3,26,000 |
|
|
|
15,71,000 |
|
15,71,000 |
||
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|
|
|
||
Working Notes:
WN1: Calculation of Gayatri’s
Share of Goodwill
Gayatri's share=3,00,000×5/10=1,50,000 to be shared in 2:3
WN1: Calculation
of Sacrificing Ratio
Sacrificing Ratio = Old Ratio – New Ratio
Madhu=2/5−2/10=2/10
Vidhi=3/5−3/10=−3/10
Question 62:
Shyam and Sanjay were in partnership business sharing profits and losses in the ratio of 2 : 3 respectively. Their Balance Sheet as at 31st March, 2022 was:
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|
Liabilities |
` |
Assets |
` |
|
|
Sundry
Creditors |
12,435 |
Cash
in Hand |
710 |
|
|
Capital
A/cs: |
|
Cash
at Bank |
11,925 |
|
|
Shyam |
34,050 |
|
Sundry
Debtors |
5,500 |
|
Sanjay |
34,050 |
68,100 |
Stock |
18,000 |
|
|
|
|
Furniture |
4,400 |
|
|
|
|
Building |
40,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
80,535 |
|
80,535 |
|
|
|
|
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|
On 1st April, 2022, they admitted Shanker into partnership for 1/3rd share in
future profits on the following terms:
(a) Shanker is to bring in ` 30,000 as his capital and
` 20,000 as
goodwill which is to remain in the business.
(b) Stock and Furniture are to be reduced in value by 10%.
(c) Building is to be appreciated by ` 15,000.
(d) Provision of 5% is to be made on Sundry Debtors for Doubtful Debts.
(e) Unaccounted Accrued Income of ` 2,400 to be provided for. A debtor, whose dues of ` 4,800 were written off as bad debts, paid 50% in full
settlement.
(f) Outstanding Rent amounted to ` 4,800.
Show Profit and Loss Adjustment Account (Revaluation Account), Capital Accounts
of Partners and opening Balance Sheet of the new firm.
Answer:
|
Profit and Loss Adjustment Account |
||||
|
Dr. |
|
Cr. |
||
|
Particulars |
` |
Particulars |
` |
|
|
Stock |
1,800 |
Building |
15,000 |
|
|
Furniture |
440 |
Accrued Income |
2,400 |
|
|
Provision for Doubtful Debts |
275 |
Bad Debts Recovered |
2,400 |
|
|
Outstanding
Rent |
4,800 |
|
|
|
|
Profit transferred to |
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|
|
|
|
Shyamlal Capital |
4,994 |
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||
|
Sanjay Capital |
7,491 |
12,485 |
||
|
|
|
19,800 |
|
19,800 |
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|
Partners’ Capital Account |
|||||||
|
Dr. |
|
|
Cr. |
||||
|
Particulars |
Shyamlal |
Sanjay |
Shanker |
Particulars |
Shyamlal |
Sanjay |
Shanker |
|
|
|
|
|
Balance b/d |
34,050 |
34,050 |
|
|
|
|
|
|
Cash A/c |
|
|
30,000 |
|
|
|
|
|
Premium for |
8,000 |
12,000 |
|
|
Balance c/d |
47,044 |
53,541 |
30,000 |
Revaluation |
4,994 |
7,491 |
|
|
|
47,044 |
53,541 |
30,000 |
|
47,044 |
53,541 |
30,000 |
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|
Balance Sheet as on April 01, 2022 after Shanker’s admission |
|||||
|
Liabilities |
` |
Assets |
` |
||
|
Sundry Creditors |
12,435 |
Cash in Hand (710 + 50,000 + 2,400) |
53,110 |
||
|
Capital A/cs: |
|
Cash at Bank |
11,925 |
||
|
Shyamlal |
47,044 |
|
Sundry Debtors |
5,500 |
|
|
Sanjay |
53,541 |
|
Less: Provision for D. Debts |
275 |
5,225 |
|
Shanker |
30,000 |
1,30,585 |
Stock (18,000 – 1,800) |
16,200 |
|
|
Outstanding Rent |
4,800 |
Building (40,000 + 15,000) |
55,000 |
||
|
|
|
Furniture
(4,400 – 440) |
3,960 |
||
|
|
|
Accrued Income |
2,400 |
||
|
|
1,47,820 |
|
1,47,820 |
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|
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|
||
Working Notes:
|
|
Shyamlal |
|
Sanjay |
|
Sacrificing ratio = |
2 |
: |
3 |
WN1
Distribution of Premium for Goodwill (in sacrificing ratio)
Shyamlal will get=20,000×2/5= ` 8,000
Sanjay will get=20,000×3/5= ` 12,000
WN2
Distribution of Profit from Profit and Loss Adjustment Account (in old
ratio)
Shyamlal will get =12,485×2/5=4,995
Sanjay will get =12,485×3/5=7,491
Question 63:
A, B and C are
partners sharing profits and losses in the ratio of 3 : 2 : 1 respectively.
Their Balance Sheet as at 31st March, 2022 is as follows:
|
Liabilities |
` |
Assets |
` |
|
|
Capital
A/cs: |
|
Land
and Building |
50,000 |
|
|
A |
60,000 |
|
Plant
and Machinery |
40,000 |
|
B |
60,000 |
|
Furniture |
30,000 |
|
C |
40,000 |
1,60,000 |
Stock |
20,000 |
|
Creditors |
|
30,000 |
Debtors |
30,000 |
|
Bills
Payable |
|
10,000 |
Bills
Receivable |
20,000 |
|
|
|
|
Bank |
10,000 |
|
|
|
|
|
|
|
|
|
2,00,000 |
|
2,00,000 |
|
|
|
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|
D is admitted as a partner on 1st April, 2022 for equal share.
His capital is to be ` 50,000.
Following adjustments are agreed on D's admission:
(a) Out of the Creditors, a sum of
` 10,000 is due to D,
it will be adjusted against his capital.
(b) Advertisement Expenses of ` 1,200 are to be carried forward as Prepaid Expenses.
(c) Expenses debited in the Profit and Loss Account includes a sum
of ` 2,000 paid for B's personal expenses.
(d) A Bill of Exchange of ` 4,000, which was previously discounted with the bank, was dishonoured
on 31st March, 2019 but entry was not passed for dishonour.
(e) A Provision for Doubtful Debts @ 5% is to be created against Debtors.
(f) Expenses on Revaluation amounted to
` 2,100 is paid by A.
Prepare necessary Ledger Accounts and Balance Sheet after D's
admission.
Answer:
|
Revaluation Account |
||||
|
Dr. |
Cr. |
|||
|
Particulars |
` |
Particulars |
` |
|
|
Provision for doubtful Debts |
1,700 |
Prepaid Advt. Expense |
1,200 |
|
|
A’s Capital (Rev. Exp.) |
2,100 |
B’s Capital (Personal Exp.) |
2,000 |
|
|
|
|
|
|
|
|
|
|
Loss transferred to |
|
|
|
|
|
A Capital |
300 |
|
|
|
|
B Capital |
200 |
|
|
|
|
C Capital |
100 |
600 |
|
|
3,800 |
|
|
3,800 |
|
|
|
|
|
|
|
Partners’ Capital Accounts |
|||||||||
|
Dr. |
Cr. |
||||||||
|
Particulars |
A |
B |
C |
D |
Particulars |
A |
B |
C |
D |
|
Revaluation |
|
2,000 |
|
|
Balance b/d |
60,000 |
60,000 |
40,000 |
|
|
(Personal Exp.) |
|
|
|
|
Creditors |
|
|
|
10,000 |
|
Revaluation (Loss) |
300 |
200 |
100 |
|
Cash |
|
|
|
40,000 |
|
Balance c/d |
61,800 |
57,800 |
39,900 |
50,000 |
Revaluation (Exp.) |
2,100 |
|
|
|
|
|
62,100 |
60,000 |
40,000 |
50,000 |
|
62,100 |
60,000 |
40,000 |
50,000 |
|
|
|
|
|
|
|
|
|
|
|
|
Balance Sheet as on April 01,2022 after D’s admission |
|||||
|
Liabilities |
` |
Assets |
` |
||
|
Capital Accounts: |
|
Land and Building |
50,000 |
||
|
A |
61,800 |
|
Plant and Machinery |
40,000 |
|
|
B |
57,800 |
|
Furniture |
30,000 |
|
|
C |
39,900 |
|
Prepaid Advt. Expenses |
1,200 |
|
|
D |
50,000 |
2,09,500 |
Stock |
20,000 |
|
|
|
|
|
Debtors |
30,000 |
|
|
Creditors |
30,000 |
|
Add: B/R dishonor |
4,000 |
|
|
Less: D’s Capital |
10,000 |
20,000 |
Less: 5% Provision for D Debts |
(1,700) |
32,300 |
|
Bill Payable |
10,000 |
|
|
|
|
|
|
|
Bills Receivable |
|
20,000 |
|
|
|
|
Bank (10,000 + 40,000 - 4,000) |
46,000 |
||
|
|
2,39,500 |
|
2,39,500 |
||
|
|
|
|
|
||
WN1: Distribution of Loss on Revaluation
A's Capital will be debited by=600×3/6= ` 300
B's Capital will be debited by=600×2/6= ` 200
C's Capital will be debited by=600×1/6= ` 100
Question 64:
On 31st March, 2017, the Balance Sheet of Abhir and Divya, who were sharing profits in the ratio of 3 : 1 was as follows:
|
BALANCE SHEET OF ABHIR AND
DIVYA as on 31st March, 2017 |
|||||
|
Liabilities |
` |
Assets |
` |
||
|
Creditors |
2,20,000 |
Cash
at Bank |
1,40,000 |
||
|
Employees'
Provident Fund |
1,00,000 |
Debtors |
6,50,000 |
|
|
|
Investment
Fluctuation Fund |
1,00,000 |
Less:
Provision for Bad Debts |
50,000 |
6.00,000 |
|
|
General
Reserve |
1,20,000 |
Stock |
|
3,00,000 |
|
|
Capitals: |
|
Investments
(Market value ` 4,40,000) |
|
5,00,000 |
|
|
Abhir |
6,00,000 |
|
|
|
|
|
Divya |
4,00,000 |
10,00,000 |
|
|
|
|
|
15,40,000 |
|
15,40,000 |
||
|
|
|
|
|
||
They decided to admit Vibhor on 1st April, 2017 for 1/5th share.
(a) Vibhor shall bring ` 80,000 as his share of goodwill premium.
(b) Stock was overvalued by ` 20,000.
(c) A debtor whose dues of ` 5,000 were written off as bad debts, paid ` 4,000 in full settlement.
(d) Two months' salary @ ` 6,000 per month was outstanding.
(e) Vibhor was to bring in Capital to the extent of 1/5th of the total capital
of the new firm.
Prepare Revaluation Account, Partners' Capital Accounts and the Balance Sheet
of the reconstituted firm.
Answer:
|
In the books of Abhir, Divya and Vibhor |
||||||
|
Dr. |
Revaluation A/c |
Cr. |
||||
|
Particulars |
` |
Particulars |
` |
|||
|
To
Stock A/c |
20,000 |
By
Cash A/c |
4,000 |
|||
|
To
Outstanding Salary A/c (6,000 × 2) |
12,000 |
By Loss on Revaluation transferred to: |
28,000 |
|||
|
|
|
Abhir’s Capital A/c |
21,000 |
|
||
|
|
|
Divya’s Capital A/c |
7,000 |
|
||
|
|
|
|
|
|||
|
|
32,000 |
|
32,000 |
|||
|
|
|
|
|
|||
|
Dr. |
Partner’s Capital A/c |
Cr. |
|||||||
|
Particulars |
Abhir ` |
Divya ` |
Vibhor ` |
Particulars |
Abhir ` |
Divya ` |
Vibhor ` |
||
|
To
Revaluation A/c (Loss) |
21,000 |
7,000 |
|
By
balance b/d |
6,00,000 |
4,00,000 |
|
||
|
|
|
|
|
By
Bank A/c (WN2) |
|
|
3,03,000 |
||
|
To
balance c/d |
7,59,000 |
4,53,000 |
3,03,000 |
By
Premium for Goodwill A/c |
60,000 |
20,000 |
|
||
|
|
|
|
|
By
Investment Fluctuation |
30,000 |
10,000 |
|
||
|
|
|
|
|
Fund
A/c (1,00,000 – 40,000) |
|
|
|
||
|
|
|
|
|
By
General Reserve A/c |
90,000 |
30,000 |
|
||
|
|
|
|
|
|
|
|
|
||
|
|
7,80,000 |
4,60,000 |
3,03,000 |
|
7,80,000 |
4,60,000 |
3,03,000 |
||
|
|
|
|
|
|
|
|
|
||
Working Notes:
1. Calculation of New profit-sharing ratio
|
Vibhor’s
Share of Profits |
= |
1/5 |
|
Remaining
Profits |
= |
(1
– 1/5) = 4/5 |
|
Abhir’s
New Share of Profits |
= |
(3/5
× 4/5) = 12/25 |
|
Divya’s
New Share of Profits |
= |
(2/5
× 4/5) = 8/25 |
|
Abhir : Divya : Vibhor |
= |
12 : 8 : 5 |
2. Calculation of Vibhor’s Capital
Total Adjusted Capital of the Old Partners = Abhir’s Capital + Divya’s
Capital= ` (7,59,000 + 4,53,000) =
` 12,12,000
Combined New Share of the Old Partners = (12/25 + 8/25) = 20/25
|
Total
Capital of the firm |
= |
(Adjusted
Capital of the Old Partners × Reciprocal of Combined New Share of the Old
Partners) |
||||||
|
|
= |
(12,12,000
× 25/20) = ` 15,15,000 |
||||||
|
Vibhor’s Capital |
= |
Total
Capital of the firm × His Profit share |
||||||
|
|
= |
` (15,15,000 × 1/5) = ` 3,03,000 |
||||||
|
|
|
|||||||
|
as at 31st March, 2018 |
|
|||||||
|
Liabilities |
` |
Assets |
` |
|
||||
|
Capitals: |
|
Cash
at Bank |
5,27,000 |
|
||||
|
Abhir |
7,59,000 |
|
(1,40,000
+ 4,000 + 3,03,000 + 80,000) |
|
|
|||
|
Divya |
4,53,000 |
|
Debtors |
6,50,000 |
|
|
||
|
Vibhor |
3,03,000 |
15,15,000 |
Less: Provision for Bad Debts |
50,00 |
6,00,000 |
|
||
|
Employee’s
Provident Fund |
1,00,000 |
Stock |
2,80,000 |
|
||||
|
Creditors |
2,20,000 |
Investments |
4,40,000 |
|
||||
|
Outstanding
Salary |
12,000 |
|
|
|
||||
|
|
|
|
|
|
||||
|
|
18,47,000 |
|
18,47,000 |
|
||||
|
|
|
|
|
|
||||
Question 65:
X and Y share profits in the ratio of 5 : 3. Their Balance Sheet as at 31st March, 2022 was:
|
Liabilities |
` |
Assets |
` |
||
|
Creditors |
15,000 |
Cash
at Bank |
5,000 |
||
|
Employees'
Provident Fund |
10,000 |
Sundry
Debtors |
20,000 |
|
|
|
Workmen
Compensation Reserve |
5,800 |
Less: Provision for
Doubtful Debts |
600 |
19,400 |
|
|
Capital
A/cs: |
|
Stock |
|
25,000 |
|
|
X |
70,000 |
|
Fixed
Assets |
80,000 |
|
|
Y |
31,000 |
1,01,000 |
Profit
and Loss A/c |
2,400 |
|
|
|
|
|
|
|
|
|
|
1,31,800 |
|
1,31,800 |
||
|
|
|
|
|
||
They admit Z into partnership with 1/8th share in profits on 1st
April, 2022. Z brings
` 20,000 as his
capital and ` 12,000 for goodwill in cash. Z acquires his share
from X. Following revaluations are also made:
(a) Employees' Provident Fund liability is to be increased by ` 5,000.
(b) All Debtors are good.
(c) Stock includes ` 3,000 for obsolete items.
(d) Creditors are to be paid ` 1,000 more.
(e) Fixed Assets are to be revalued at
` 70,000.
Prepare Journal entries, necessary accounts and new Balance Sheet. Also,
calculate new profit-sharing ratio.
Answer:
|
Revaluation Account |
|||
|
Dr. |
|
Cr. |
|
|
Particulars |
` |
Particulars |
` |
|
Stock |
3,000 |
Provision for D. Debts |
600 |
|
Creditors |
1,000 |
|
|
|
Fixed Assets |
10,000 |
Loss transferred to |
|
|
Provident Fund |
5,000 |
X Capital |
11,500 |
|
|
|
Y Capital |
6,900 |
|
|
19,000 |
|
19,000 |
|
|
|
|
|
|
Partners’ Capital Accounts |
|||||||
|
Dr. |
|
Cr. |
|||||
|
Particulars |
X |
Y |
Z |
Particulars |
X |
Y |
Z |
|
Revaluation (Loss) |
11,500 |
6,900 |
|
Balance b/d |
70,000 |
31,000 |
|
|
Profit and Loss |
1,500 |
900 |
|
Workmen’s Comp. |
3,625 |
2,175 |
|
|
Balance c/d |
72,625 |
25,375 |
20,000 |
Cash |
|
|
20,000 |
|
|
|
|
|
Premium for Goodwill |
12,000 |
|
|
|
|
85,625 |
33,175 |
20,000 |
|
85,625 |
33,175 |
20,000 |
|
|
|
|
|
|
|
|
|
|
Balance Sheet as on March 31, 2022 after Z’s admission |
||||
|
Particulars |
` |
Assets |
` |
|
|
Creditors (15,000 + 1,000) |
16,000 |
Land and Building |
5,000 |
|
|
Provident Fund (10,000 + 5,000) |
15,000 |
Sundry Debtors |
20,000 |
|
|
Capital A/cs: |
|
Stock (25,000 – 3,000) |
22,000 |
|
|
X |
72,625 |
|
Fixed Assets (80,000 – 10,000) |
70,000 |
|
Y |
25,375 |
|
Cash |
32,000 |
|
Z |
20,000 |
1,18,000 |
|
|
|
|
1,49,000 |
|
1,49,000 |
|
|
|
|
|
|
|
Working Notes
WN1: Distribution of Revaluation Loss
X’s capital will be debited =18,400×5/8=11,500
Y’s
capital will be debited =18,400×3/8=6,900
WN2: Distribution Accumulated Loss
X’s capital will be debited =2,400×5/8=1,500
Y’s
capital will be Credited =2,400×3/8=900
WN3: Distribution of Workmen’s Compensation Fund
X’s capital will be credited =5,800×5/8=3,625
Y’s
capital will be Credited =5,800×3/8=2,175
WN4: Z’s premium for goodwill will be transferred to X’s
Capital Account because Z receives his entire share from X.
WN5: Calculation of New Profit Sharing Ratio
Z acquired 1/8th share from X
New share of X=5/8-1/8=4/8
New share of Y=3/8
New share of Z=1/8
New profit sharing ratio= 4;3:1
Ts Grewal Solution 2022-2023
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Class 12 / Volume – I
Chapter 1 – Admission of a Partner
Question No. 1 To 5
Question No. 5 To 10
Question No. 11 To 15
Question No. 16 To 20
Question No. 21 To 25
Question No. 26 To 30
Question No. 31 To 35
Question No. 36 To 40
Question No. 41 To 45
Question No. 46 To 50
Question No. 51 To 55
Question No. 56 To 60
Question No. 61 To 65
Question No. 66 To 70
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Question No. 76 To 80
Question No. 81 To 83
Question No. 84 To 86
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12th TS Grewal’s Accountancy Solutions