Question 11
Hari, Ram and Shyam who were
sharing profits and losses in the ratio of 5:3: 2,
decide to share future profits and losses in the ratio of 2:2:1. Goodwill of
the firm is valued at 1,00,000. Goodwill existing in
the books is 40,000.
Show
the necessary accounting treatment by raising Goodwill Account.
Answer:
|
Journal |
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|||||
|
Date |
Particulars |
L.F. |
Debit ` |
Credit ` |
|
|
|
1. |
Hari's
Capital A/c |
Dr. |
|
20,000 |
|
|
|
|
Ram’s Capital A/c |
Dr. |
|
12,000 |
|
|
|
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Shyam's Capital A/c |
Dr. |
|
8,000 |
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|
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To Goodwill A/c |
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|
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40,000 |
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|
(Being Goodwill is written off) |
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2. (a) |
Goodwill A/c |
Dr. |
|
1,00,000 |
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To Hari's
Capital A/c |
|
|
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50,000 |
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To Ram’s Capital A/c |
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30,000 |
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To Shyam's Capital A/c |
|
|
20,000 |
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|
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(Being Goodwill is Raised to write off) |
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(b) |
Hari's
Capital A/c |
Dr. |
|
40,000 |
|
|
|
|
Ram’s Capital A/c |
Dr. |
|
40,000 |
|
|
|
|
Shyam's Capital A/c |
Dr. |
|
20,000 |
|
|
|
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To Goodwill A/c |
|
|
1,00,000 |
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|
|
|
(Being Goodwill is written off) |
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Working
Note;
Old
Goodwill is written off as follow
Arun= 40.000×2/5 = 20,000
Varun= 40.000×2/5 = 12,000
Tarun= 40.000×1/5 = 8,000
1.
Valued Goodwill is raised to write off as
follow
Arun= 1,00.000×5/10 =50,000
Varun=1,00.000×3/10=30,000
Tarun=1,00.000×2/10
=20,000
2.
Valued Goodwill is written off as follow
Arun= 1,00.000×2/5 =40,000
Varun= 1,00.000×2/5
=40,000
Tarun= 1,00.000×1/5=20,000
Question 12:
.
A, B and C shared profits and losses in the ratio of 3: 2:1 respectively. With
effect from
1st
April, 2023, they agreed to share profits equally. The goodwill of the firm was
valued at 18,000.
Pass
necessary Journal entries when:
(a)
Goodwill is adjusted through Partners' Capital Accounts; and
(b)
Goodwill is raised and written off.
Answer:
(a)
Goodwill is adjusted through Partners' Capital Accounts;
|
Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit ` |
Credit ` |
|
|
1. |
C's
Capital A/c |
Dr. |
|
3,000 |
|
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To A's Capital A/c |
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|
3,000 |
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|
(Being sacrificing partner compensated) |
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(b)
Goodwill is raised and written off.
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Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit ` |
Credit ` |
|
|
|
Goodwill A/c |
Dr. |
|
18.000 |
|
|
|
To A's
Capital A/c |
|
|
|
9,000 |
|
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To B’s
Capital A/c |
|
|
|
6,000 |
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To C's Capital A/c |
|
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|
3,000 |
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|
(Being Goodwill is Raised) |
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A's Capital A/c |
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6,000 |
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B’s Capital A/c |
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|
6,000 |
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C's Capital A/c |
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|
6,000 |
|
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To Goodwill A/c |
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|
18.000 |
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(Being Goodwill is written off) |
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Calculation of New Profit-sharing Ratio on the basis of Adjustment
of Goodwill
Question 13:
.
Naman, Aman and Raman are
partners sharing profits and losses 2023, they decide
to change the profit-sharing ratio. They pass the following adjustment entry
for goodwill the ratio of 2:2: 1. From 1st April in the books:
|
Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit ` |
Credit ` |
|
|
April 1 |
Naman's Current A/c (Rs.
2,00,000×3/25) |
Dr. |
|
24,000 |
|
|
|
Raman's
Current A/c (Rs. 2,00,000×2/25) |
Dr. |
|
16,000 |
|
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|
To
Aman's Current A/c (Rs. 2,00,000×5/25) |
|
|
|
|
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|
(Being
goodwill adjusted on change in profit-sharing ratio) |
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40,000 |
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What
will be the new profit-sharing ratio of partners assuming capital of partners
are fixed?
Answer:
|
Naman |
=
2/5+3/25 |
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=
10-3/25 |
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=
13/25 |
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Aman |
=
2/5-5/25 |
|
|
=
10-5/25 |
|
|
=
5/25 |
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Raman
|
=
1/5+2/25 |
|
|
=
5+2/25 =
7/25 |
Question 14:
Nitya and
Anand are partners in a firm sharing profits
and losses in the ratio of 3 : 2. With effect from 1st
April, 2023, they decided to share future profits equally. On the date of
change in the profit-sharing ratio, the Profit and Loss Account showed a credit
balance of ` 1,50,000.
Record the necessary Journal entry for the distribution of the balance in the
Profit and Loss Account immediately before the change in the profit-sharing
ratio.
Answer:
|
Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit ( `) |
Credit ( `) |
|
|
2023 |
|
|
|
|
|
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To Nitya’s Capital A/c |
|
|
|
90,000 |
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To Anand’s Capital A/c |
|
|
|
60,000 |
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(Being
Adjustment of balance in P&L A/c in old ratio) |
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Working Notes:
WN1 Calculation
of Share of Profit and Loss A/c
Nisha's share=1,50,000×3÷5=90,000
Anand's share=1,50,000×2÷5=60,000
Question 15:
Om and Shiv are partners in a
firm sharing profits in the ratio of 4 : 1. They
decided to share future profits in the ratio of 3 : 2 w.e.f. 1st April, 2023. On that day,
Profit and Loss Account showed a debit balance of `
1,00,000. Pass Journal entry to give effect to the above.
Answer:
|
Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit ( `) |
Credit ( `) |
|
|
2023 |
|
|
|
|
|
|
April 1 |
Om’s Capital A/c |
Dr. |
|
80,000 |
|
|
|
Shiv’s Capital A/c |
Dr. |
|
20,000 |
|
|
|
To Profit & Loss A/c |
|
|
|
1,00,000 |
|
|
(Being Profit
& Loss distributed) |
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Ts Grewal Solution 2023-2024
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Class 12 / Volume – I