Question
31:
Alfa, Beta
and Gama are in partnership sharing profits in the ratio of 5:3:2.Their Balance
Sheet on 1st April, 2025, the day Beta decided to retire from firm, was as
follows:
|
Liabilities
|
₹ |
Assets |
₹ |
|
Alfa's Capital |
3,00,000 |
Building |
2,50,000 |
|
Beta's Capital |
2,00,000 |
Machinery |
1,50,000 |
|
Gama's Capital |
2,00,000 |
Investments |
2.50,000 |
|
General Reserve |
1,00,000 |
Debtors |
1,00,000 |
|
Sundry Creditors |
1,00,000 |
Stock |
50,000 |
|
|
|
Cash at Bank |
1,00,000 |
|
|
9,00,000 |
|
9,00,000 |
The terms of retirement were:
(i) Beta takes goodwill
from Alfa for ₹ 30,000 and from Gama for ₹ 40,000 for foregoing his
share of profits.
(ii) Stock to be appreciated by 20% and building by
50,000.
(iii) Investments were sold for 2,70,000.
(iv) Beta
is paid by bank draft.
Prepare Revaluation Account, Partners' Capital
Accounts and Balance Sheet of the new firm.
Answer:
|
Revaluation
A/c |
|||
|
Particulars |
₹ |
Particulars |
₹ |
|
Gain |
|
Building |
50,000 |
|
Capital A/cs:
|
|
Investments |
20,000 |
|
Alfa's
40,000 |
|
Stock |
10,000 |
|
Beta's
24,000 |
|
|
|
|
Gama's
16,000 |
80,000 |
|
|
|
|
80,000 |
|
80,000 |
|
Capital A/c |
|||||||
|
Particulars |
Alfa |
Beta |
Gama |
Particulars |
Alfa |
Beta |
Gama |
|
To Beta's Capital A/c |
30,000 |
- |
40,000 |
By Balance B/d |
3,00,000 |
2,00,000 |
2,00,000 |
|
To Bank A/c |
- |
3,24,000 |
- |
By Revaluation A/c |
40,000 |
24,000 |
16,000 |
|
To Balance C/d |
3,60,000 |
- |
1,96,000 |
By General Reserve |
50,000 |
30,000 |
20,000 |
|
|
|
|
|
By Alfa's Capital A/c |
- |
30,000 |
- |
|
|
|
|
|
By Gama's Capital A/c |
- |
40,000 |
- |
|
|
3,90,000 |
3,24,000 |
2,36,000 |
|
3,90,000 |
3,24,000 |
2,36,000 |
|
Balance Sheet |
|||
|
Liabilities |
₹ |
Assets |
₹ |
|
Alfa's
Capital |
3,60,000 |
Building
|
3,00,000 |
|
Beta's
Capital |
1,96,000 |
Machinery
|
1,50,000 |
|
Sundry
Creditors |
1,00,000 |
Debtors
|
1,00,000 |
|
|
|
Stock
|
60,000 |
|
|
|
Cash
at Bank |
46,000 |
|
|
|
|
|
|
|
9,00,000 |
|
9,00,000 |
Question 32:
Kanika, Disha and Kabir were partners
sharing profits in the ratio of 2 : 1 : 1. On 31st
March, 2025, their Balance Sheet was as under:
|
Liabilities |
(₹) |
Assets |
(₹) |
||
|
Trade
creditors |
53,000 |
Bank |
60,000 |
||
|
Employees'
Provident Fund |
47,000 |
Debtors |
60,000 |
||
|
Kanika's Capital |
2,00,000 |
Stock |
1,00,000 |
||
|
Disha's Capital |
1,00,000 |
Fixed
assets |
2,40,000 |
||
|
Kabir's Capital |
80,000 |
Profit
and Loss A/c |
20,000 |
||
|
|
|
|
|
||
|
|
|
|
|
||
|
|
|
|
|
||
|
|
4,80,000 |
|
4,80,000 |
||
|
|
|
|
|
||
|
|
|
|
|
|
|
Kanika retired on 1st April, 2025. For
this purpose, the following adjustments were agreed upon:
(a) Goodwill of the firm was valued at 2 years' purchase of average profits of
three completed years preceding the date of retirement. The profits for the
year:
2023 were ₹ 1,00,000
and for 2024 were ₹ 1,30,000.
(b) Fixed Assets were to be increased to ₹ 3,00,000.
(c) Stock was to be valued at 120%.
(d) The amount payable to Kanika was transferred to
her Loan Account.
Prepare Revaluation Account, Capital Accounts of the partners and the Balance
Sheet of the reconstituted firm.
(AI 2017 C Modified)
Answer:
|
Revaluation Account |
|||||
|
Dr. |
Cr. |
||||
|
Particulars |
₹ |
Particulars |
₹ |
||
|
Revaluation
Profit |
|
Fixed
Assets |
60,000 |
||
|
Kanika’s Capital |
40,000 |
|
Stock |
20,000 |
|
|
Disha’s Capital |
20,000 |
|
|
|
|
|
Kabir’s Capital |
20,000 |
80,000 |
|
|
|
|
|
80,000 |
|
80,000 |
||
|
|
|
|
|
||
|
Partners’ Capital Account |
||||||||
|
Dr. |
Cr. |
|||||||
|
Particulars |
Kanika |
Disha |
Kabir |
Particulars |
Kanika |
Disha |
Kabir |
|
|
Profit
& Loss A/c |
10,000 |
5,000 |
5,000 |
Balance
b/d |
2,00,000 |
1,00,000 |
80,000 |
|
|
Kanika’s Capital A/c |
|
35,000 |
35,000 |
Disha’s Capital A/c |
35,000 |
|
|
|
|
Kanika’s Loan A/c |
3,00,000 |
|
|
Kabir’s Capital A/c |
35,000 |
|
|
|
|
Balance
c/d |
|
80,000 |
60,000 |
Revaluation |
40,000 |
20,000 |
20,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
3,10,000 |
1,20,000 |
1,00,000 |
|
3,10,000 |
1,20,000 |
1,00,000 |
|
|
|
|
|
|
|
|
|
|
|
|
Balance Sheet as on March 31,
2025 |
||||
|
Liabilities |
(₹) |
Assets |
(₹) |
|
|
Employees’
Provident Fund |
47,000 |
Bank |
60,000 |
|
|
Trade
Creditors |
53,000 |
Sundry
Debtors |
60,000 |
|
|
Kanika’s Loan A/c |
3,00,000 |
Stock |
1,20,000 |
|
|
Capitals |
|
Fixed
Assets |
3,00,000 |
|
|
Disha |
80,000 |
|
|
|
|
Kabir |
60,000 |
1,40,000 |
|
|
|
|
5,40,000 |
|
5,40,000 |
|
|
|
|
|
|
|
Working Notes:
WN1: Calculation of Goodwill
Goodwill=Average Profits×Number of Years' Purchase
Average Profits=Total ProfitsNumber of Years=1,00,000+1,30,000−20,000/3=2,10,000/3=₹ 70,000
Goodwill=70,000×2=₹ 1,40,000
Kanika's share=1,40,000×2/4=70,000 (to be borne by gaining partners in gaining ratio)
Note: Since no information is given about the share of gain,
it is assumed that the old partners are gaining in their old profit sharing
ratio.
Question 33:
N, S and G were partners in a
firm sharing profits and losses in the ratio of 2 : 3
: 5. On 31st March, 2016 their Balance Sheet was as under:
|
Liabilities |
(₹) |
Assets |
(₹) |
||
|
Creditors |
1,65,000 |
Cash |
1,20,000 |
||
|
General
Reserve |
90,000 |
Debtors |
1,35,000 |
|
|
|
Capitals: |
|
Less: Provision |
15,000 |
1,20,000 |
|
|
N |
2,25,000 |
|
Stock |
1,50,000 |
|
|
S |
3,75,000 |
|
Machinery |
4,50,000 |
|
|
G |
4,50,000 |
10,50,000 |
Patents |
90,000 |
|
|
|
|
|
Building |
3,00,000 |
|
|
|
|
|
Profit
and Loss Account |
75,000 |
|
|
|
13,05,000 |
|
13,05,000 |
||
|
|
|
|
|
||
G retired on the above date and it was agreed that:
(a) Debtors of ₹ 6,000 will be written off as bad debts and a
provision of 5% on debtors for bad and doubtful debts will be maintained.
(b) Patents will be completely written off and stock, machinery and building
will be depreciated by 5%.
(c) An unrecorded creditor of ₹ 30,000 will be taken into
account.
(d) N and S will share the future profits in 2 : 3 ratio.
(e) Goodwill of the firm on G's retirement was valued at ₹
90,000.
Pass necessary Journal entries for the above transactions in the books of the
firm on G's retirement.
(Foreign 2017)
Answer:
|
Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit (₹) |
Credit (₹) |
|
|
|
General
Reserve A/c |
Dr. |
|
90,000 |
|
|
|
To N’s Capital A/c |
|
|
|
18,000 |
|
|
To S’s Capital A/c |
|
|
|
27,000 |
|
|
To G’s Capital A/c |
|
|
|
45,000 |
|
|
(Balance
in reserve distributed among all partners in old ratio) |
|
|
|
|
|
|
|
|
|
|
|
|
|
N’s
Capital A/c |
Dr. |
|
15,000 |
|
|
|
S’s
Capital A/c |
Dr. |
|
22,500 |
|
|
|
G’s
Capital A/c |
Dr. |
|
37,500 |
|
|
|
To Profit & Loss A/c |
|
|
|
75,000 |
|
|
(Debit
balance P&L A/c written off among all partners in old ratio) |
|
|
|
|
|
|
|
|
|
|
|
|
|
N’s
Capital A/c |
Dr. |
|
18,000 |
|
|
|
S’s
Capital A/c |
Dr. |
|
27,000 |
|
|
|
To G’s Capital A/c |
|
|
|
45,000 |
|
|
(Goodwill
adjusted in gaining ratio) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Revaluation
A/c |
Dr. |
|
1,65,000 |
|
|
|
To Patent A/c |
|
|
|
90,000 |
|
|
To Stock A/c |
|
|
|
7,500 |
|
|
To Machinery A/c |
|
|
|
22,500 |
|
|
To Building A/c |
|
|
|
15,000 |
|
|
To Creditors A/c |
|
|
|
30,000 |
|
|
(Decrease
in assets and increase in liabilities debited to Revaluation A/c) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision
for Doubtful Debts A/c |
Dr. |
|
2,550 |
|
|
|
To Revaluation A/c |
|
|
|
2,550 |
|
|
(Excess
provision written back) |
|
|
|
|
|
|
|
|
|
|
|
|
|
N’s
Capital A/c |
Dr. |
|
32,490 |
|
|
|
S’s
Capital A/c |
Dr. |
|
48,735 |
|
|
|
G’s
Capital A/c |
Dr. |
|
81,225 |
|
|
|
To Revaluation A/c |
|
|
|
1,62,450 |
|
|
(Loss on
revaluation debited to partners’ capital accounts in old ratio) |
|
|
|
|
|
|
|
|
|
|
|
|
|
G’s
Capital A/c |
Dr. |
|
4,21,275 |
|
|
|
To G’s Loan A/c |
|
|
|
4,21,275 |
|
|
(Amount due
to G transferred to his loan A/c) |
|
|
|
|
Working Notes:
WN1: Calculation of G’s Share of Goodwill
G's share=Firm's Goodwill×G's Profit Share
G's share=90,000×5/10=45,000 (to be borne by gaining partners in gaining ratio)
WN2: Calculation of Gaining
Ratio
Gaining Ratio = New Ratio − Old Ratio
N's gain=2/5−2/10=2/10
S's gain=3/5−3/10=3/10Gaining Ratio=2:3
N's share=45,000×2/5=18,000
S's share=45,000×3/5=27,000
WN2: Calculation of Excess/Deficit Provision for
Doubtful Debts
Required Provision @5%=1,35,000−6,000×5÷100=6,450
Existing Provision after writing bad-debts= 9,000
Excess Provision to be written back=2,550=9,000−6,450
WN3: Calculation of G’s Loan Balance
Amount due to G = Opening Capital + Credits – Debits
= 4,50,000 + (45,000 + 45,000) – (37,500 + 81,225)
= ₹ 4,21,275
Question 34:Ashok,
Bhaskar and Chaman are
partners in a firm, sharing profits and losses as Ashok 1/3, Bhaskar 1/2, and Chaman 1/6
respectively. The Balance Sheet of the firm as at 31st March, 2024
was
|
Liabilities |
₹ |
Assets |
₹ |
||
|
Capital A/cs: |
|
|
Building |
|
5,00,000 |
|
Ashok |
3,00,000 |
|
Plant and Machinery |
|
4,00,000 |
|
Bhaskar |
4,00,000 |
|
Furniture |
|
1,00,000 |
|
Chaman |
2,50,000 |
9,50,000 |
Stock |
|
2,50,000 |
|
General Reserve |
|
2,20,000 |
Debtors |
1,80,000 |
|
|
Sundry Creditors |
|
2,50,000 |
Less: Provision for Doubtful Debts |
5,000 |
1,75,000 |
|
Loan Payable |
|
1,50,000 |
Cash in Hand |
|
85,000 |
|
|
|
|
Advertisement Suspense Account |
|
60,000 |
|
|
|
15,70,000 |
|
|
15,70,000 |
Chaman
retired on 1st April, 2025 subject to the following adjustments:
(a) Goodwill of the firm be valued at ₹2,40,000. Chaman's share of
goodwill be adjusted into the Capital Accounts of
Ashok and Bhaskar who will share future profits in
the ratio of 3:2.
(6) Plant and Machinery to be reduced by 10% and
Furniture by 5%.
(c) Stock to be increased by 15% and Building by
10%.
(d) Provision for Doubtful Debts to be raised to ₹20,000.
Prepare Revaluation Account, Capital Account of Chaman and the Balance Sheet of the firm after Chaman's retirement.
Answer:
|
Profit and loss adjustment a/c |
|||
|
Dr. |
|
|
Cr. |
|
Particulars |
₹ |
Particulars |
₹ |
|
To Plan and machinery To
Furniture To
Prov. for doubtful debts To
capital a/c (profit
transferred to) Ashok =27,500×2/6= 9,167 Bhaskar=27,500×3/6=13,750 Chaman =27,500×1/6=4,583 |
40,000 5,000 15,000 27,500 |
By
stock By
factory building |
37,500 50,000 |
|
|
87,500 |
|
87,500 |
1
|
Partners’ Capital Account |
||||||||
|
Dr. |
Cr. |
|||||||
|
Particulars |
Ashok |
Bhaskar |
Chaman |
Particulars |
Ashok |
Bhaskar |
Chaman |
|
|
B’s
Capital A/c |
24,000 |
Balance
b/d |
3,00,000 |
4,00,000 |
2,50,000 |
|||
|
C’s
Capital A/c |
40,000 |
A’s
Capital A/c |
24,000 |
40,000 |
||||
|
Advertisement
sus. a/c C’s loan
a/c |
20,000 |
30,000 |
10,000 3,21,250 |
Profit and loss
adjustment a/c General reserve
a/c |
9,167 73,333 |
13,750 1,10,000 |
4,583 36,667 |
|
|
Balance
c/d |
2,98,500 |
5,17,750 |
||||||
|
|
||||||||
|
|
3,82,500 |
5,47,750 |
3,31,250 |
|
3,82,500 |
5,47,750 |
3,31,250 |
|
|
|
|
|
|
|
|
|
|
|
|
Balance Sheet |
||||||||||
|
as on April 01, 2025 (after C’s Retirement) |
||||||||||
|
Liabilities |
Amount (₹) |
Assets |
Amount (₹) |
|||||||
|
Sundry
Creditors |
2,50,000 |
Factory
building |
5,50,000 |
|||||||
|
Loan
Payable |
1,50,000 |
Plant
and machinery |
3,60,000 |
|||||||
|
C’s
Loan |
3,21,250 |
Furniture
|
95,000 |
|||||||
|
Stock |
2,87,500 |
|||||||||
|
Capital
A/c |
|
Debtors 1,80,000 |
||||||||
|
Ashok |
2,98,500 |
|
Less;
prov. 20,000 |
1,60,000 |
||||||
|
Bhaskar |
5,17,750 |
3,54,000 |
Cash |
85,000 |
||||||
|
|
15,37,500 |
|
15,37,500 |
|||||||
|
|
|
|
|
|||||||
|
Journal |
|
||||||||||
|
Date |
Particulars |
L.F. |
Debit (₹) |
Credit (₹) |
|
||||||
|
|
Ashok’s Capital A/c |
Dr. |
|
64,000 |
|
|
|||||
|
|
To Bhaskar’s Capital A/c |
|
|
|
24,000 |
|
|||||
|
|
To Chaman’s Capital A/c |
|
|
|
40,000 |
|
|||||
|
|
(Being goodwill adjusted for
compensating bhaskar, Chaman) |
|
|
|
|
||||||
|
|
|
|
|
|
|
||||||
|
|
Profit and loss adjustment a/c |
Dr. |
|
60,000 |
|
|
|||||
|
|
To Plant and machinery A/c |
|
40,000 |
|
|||||||
|
|
To Furniture A/c |
|
5,000 |
|
|||||||
|
|
To Prov. for doubtful debts A/c |
|
|
15,000 |
|
||||||
|
|
(Decrease
in assets and increase in liabilities debited to Revaluation A/c) |
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|||||
|
|
N’s
Capital A/c |
Dr. |
|
18,000 |
|
|
|||||
|
|
S’s
Capital A/c |
Dr. |
|
27,000 |
|
|
|||||
|
|
To G’s Capital A/c |
|
|
|
45,000 |
|
|||||
|
|
(Goodwill
adjusted in gaining ratio) |
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|||||
|
|
Stock
A/c |
Dr. |
|
37,500 |
|
||||||
|
|
Factory
building A/c |
Dr. |
|
50,000 |
|
||||||
|
|
To
P&L adjustment A/c |
|
87,500 |
|
|||||||
|
|
(Decrease
in assets debited to Revaluation A/c) |
|
|
||||||||
|
|
|
|
|
|
|
||||||
Working
notes;
Old ratio of Ashok
:Bhaskar : chaman=1/3:1/2:1/6
=1/3×2/2:1/2×3/3=1/6
=2/6:3/6:1/6
=2:3:1
New ratio of Ashok and Bhaskar= 3:2
Gaining ratio= New ratio – old ratio
Ashok = 3/5-2/6=18-10/30=8/30
Bhaskar=
2/5-3/6=12-15/30= -3/30
Goodwill of firm= 2,40,000
Bhaskar will get =2,40,000×3/30=24,000
Chaman’s share of
goodwill = 2,40,000×1/6=40,000
Ashok will give Bhaskarand, chaman 24,000, 40,000 respectively.
Question 35:
Chintan,
Ayush and Sudha were
partners in a firm sharing profits and losses in the ratio of 5: 3:2. On 31st
March, 2019, their Balance Sheet was as follows:
|
BALANCE
SHEET OF CHINTAN, AYUSH AND SUDHA as at 31st March, 2019 |
|||||
|
Liabilities |
₹ |
Assets |
₹ |
||
|
Capitals: |
|
Plant and Machinery |
|
90,000 |
|
|
Chintan |
90,000 |
|
Furniture |
|
60,000 |
|
Ayush |
60,000 |
|
Stock |
|
30,000 |
|
Sudha |
40,000 |
1,90,000 |
Debtors |
60,000 |
|
|
Provident Fund |
|
30,000 |
Less: Provision for Doubtful Debts |
5,000
|
55,000 |
|
General Reserve |
|
20,000 |
Cash at Bank |
|
15,000 |
|
Creditors |
|
10,000 |
|
|
|
|
|
|
2,50,000 |
|
|
2,50,000 |
Chintan
retired on the above date and it was agreed that:
(a) Debtors of ₹5,000 were to be written off
as bad debts and a provision of 5% on debtors for bad and doubtful debts was to
be created.
(b) Goodwill of the firm on Chintan's
retirement was valued at ₹1,00,000 and Chintan's share of the same will be adjusted by debiting
the Capital Accounts of Ayush and Sudha.
(c) Stock was revalued at ₹36,000.
(d) Furniture was undervalued by ₹9,000.
(e) Liability for Workmen's Compensation of ₹2,000
was to be created.
(f) Chintan was to be paid
₹20,000 by cheque and the balance was to be
transferred to his loan account.
Pass the necessary Journal entries in the books of
the firm on Chintan's retirement.
(CBSE 2020 C)
Answer:
|
Date |
Particulars |
L.F. |
Dr. (₹) |
Cr. (₹) |
|
|
|
Stock A/c Furniture A/c Provision A/c To
Revolution A/c (Being Decrease in the Value of Liabilities and
increase in the value of Assets) |
Dr. Dr. Dr. |
|
6,000 9,000 2,250 |
17,250 |
|
|
Revaluation A/c To
Bad debts A/c To
Liabilities for Worker compensation A/c (Being Decrease in the Value of Assets and
increase in the value of Liabilities) |
Dr. |
|
7,000 |
5,000 2,000 |
|
|
Revaluation A/c To Chintan’s Capital A/c To Ayush’s Capital A/c To Sudha’s Capital A/c (being gain of revaluation Account transferred to
Capital accounts) |
Dr. |
|
10,250 |
5,125 3,075 2,050 |
|
|
General Reserve A/c To Chintan’s Capital A/c To Ayush’s Capital A/c To Sudha’s Capital A/c (being gain of General Reserves transferred to
Capital accounts) |
Dr. |
|
20,000 |
10,000 6,000 4,000 |
|
|
Ayush’s
Capital A/c Sudha’s
Capital A/c To Chintan’s Capital A/c (Being Retiring Partner compensated) |
Dr. Dr. |
|
30,000 20,000 |
50,000 |
|
|
Chintan’s
Capital A/c To Bank
A/c (Being Chintan was paid ₹20,000
through cheque) |
Dr. |
|
20,000 |
20,000 |
|
|
Chintan’s
Capital A/c To Chintan’s Loan A/c (Being balance of Capital transferred to His loan
Account) |
Dr. |
|
1,35,125 |
1,35,125 |
Ts Grewal Solution 2025-2026
Click below for more Questions
Class 12 / Volume – I