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Question 39 Chapter 6 - Unimax Class 12 Part 1 - 2021
39. Lal, Bal and Pal were partners, sharing profitsin the ratio of 2:2:1 respectively. Their summarized balance sheet was as follows:
| Liabilities | Amount | Assets |
Amount | ||
| Capital a/c | Goodwill | 40,000 | |||
| Lal | 1,40,000 | Fixed assets | 1,80,000 | ||
| Bal | 1,00,000 | Debtors | 70,000 | ||
| Pal | 60,000 | Stock | 90,000 | ||
| Current Liabilities | 92,000 | Cash at Bank | 12,000 | ||
Pal retired and his interest in respect of Goodwill and capital valued at ₹80000 was purchased by Lal and Bal by bringing in cash in the proportion in which they share profits. Bsl’s son Dev was admitted to a partnership on the following terms:
Prepare capital a/c, Bank a/c, Balance sheet of the reconstituted firm.
Revaluation account
| Particulars | Rs. | Particulars | Rs. | |
|---|---|---|---|---|
| To profit on revaluation | By fixed assets a/c | 60,000 | ||
| Lal | 30,000 | |||
| Bal | 30,000 | 60,000 | ||
| 60,000 | 60,000 |
Partners Capital accounts
| Particulars | Lal | Bal | Pal | Dev | Particulars | Arthur | Baldwin | Curtis | |
|---|---|---|---|---|---|---|---|---|---|
| To Pal | 10,000 | 10,000 | By balance b/d | 1,40,000 | 1,00,000 | 60000 | |||
| To bank a/c | 80,000 | By Lal | 10000 | ||||||
| To goodwill a/c | 20,000 | 20,000 | By Bal | 10000 | |||||
| To bank a/c | 40,000 | By bank | 40,000 | 40,000 | |||||
| To balance c/d | 2,00,000 | 1,00,000 | By profit on rev. | 30,000 | 30,000 | ||||
| By bank a/c | 1,00,000 | ||||||||
| By bank a/c | 20,000 | ||||||||
| 2,30,000 | 1,70,000 | 80,000 | 1,00,000 | 2,30,000 | 1,70,000 | 80,000 | 1,00,000 |
Balance sheet
| Liabilities | Amount | Assets | Amount | |
|---|---|---|---|---|
| Capitals | Fixed assets | 240000 | ||
| Lal | 2,00,000 | Debtors | 70000 | |
| Bal | 1,00,000 | Stock | 90000 | |
| Pal | 1,00,000 | 4,00,000 | Bank | 12000 |
| Current liabilities | 92,000 | Cash (80000+100000+20000-80000 -40000) | 80000 | |
| 4,92,000 | 4,92,000 |
WORKING NOTE:
1) Pal’s interest includes ₹80000 (₹60000 for capital and ₹20000for goodwill which is to be paid by Lal and Bal in 1:1) and paid by bringing cash ₹80000by Lal and Bal in 1:1Arthur =5/8 – 4/9= 45/72-32/72 = 13/72.
2) Revaluation and goodwill has been written off after retirement.
3) Total capital of firm =100000×4/1.
4) Dev’s capital base=₹ 400000 to be divided in ratio 2:1:1.
https://tutorstips.com/retirement-of-a-partner-explained-with-illustration/
T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)
Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication
Accounting & Commerce Educator
Sarbjit Singh holds a B.Com and M.Com degree and has over 12 years of teaching experience in double entry bookkeeping, financial accounting, and business studies.
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