Question 45 Chapter 5 - Unimax Class 12 Part 1 - 2021

(i)He will introduce Rs. 40000 as his capital and will pay Rs. 20000 to the existing partners for his share of goodwill.

(ii)The new profit sharing ratio is 2 : 1 : 1 respectively for Vimal, Nirmal and Kailash.

(iii)A revaluation of assets will be made by reducing plant and machinery to Rs. 35000 and stock by 10%. Provision of Rs. 1000 to be created for bad and doubtful debts.
Pass journal entries for the above arrangement and give the Balance Sheet of the newly constituted firm. Also specify the sacrifice ratio.

The solution of Question 45 Chapter 5 - Unimax Class 12 Part 1

Journal

Date	Particulars		L.F.	Debit	Credit
	Revaluation a/c	Dr.		20000
	To Plant and Machinery a/c				15000
	To Stock A/c				4000
	To Provision for bad debts a/c				1000
	(Being value of assets decreased)
	Vimal’s Capital a/c	Dr.		12000
	Nirmal’s Capital a/c	Dr.		8000
	To Revaluation A/c				20000
	(Being net loss transferred to old partners capital a/c in old ratio)
	Cash a/c	Dr.		60000
	To Kailash’s capital a/c				40000
	To Premium A/c				20000
	(Being capital and goodwill brought in cash by new partner)
	Premium a/c	Dr.		20000
	To Vimal’s capital a/c				8000
	To Nirmal’s capital a/c				12000
	(Being goodwill credited to old partner’s capital A/c in sacrificing ratio)

 

Date	Particulars		L.F.	Debit	Credit
	Profit and Loss a/c	Dr.		10000
	To Vimal’s Capital A/c				6000
	To Nirmal’s Capital A/c				4000
	(Being Profits of the business credited to old partners’s capital a/c in old ratio)

  Revaluation A/c

Particulars	Rs.	Particulars		Rs.
To Stock A/c	4000	By Loss on Revaluation A/c
To Plant and Machinery A/c	15000	Vimal ( 3 : 2 )	12000
To Provision on doubtful debts A/c	1000	Nirmal	8000	20000
	20000			20000

  Capital Accounts    

Particulars	Vimal	Nirmal	Kailash	Particulars	Vimal	Nirmal	Kailash
To Loss on revaluation A/c	12000	8000	_	By Balance b/d	60000	32000	_
To Balance c/d	62000	40000	40000	By Cash A/c	_	_	40000
				By Premium A/c	8000	12000	_
				By Profit and Loss A/c ( 3 : 2)	6000	4000	_
	74000	48000	40000		74000	48000	40000

  Balance Sheet

Particulars		Rs.	Particulars		Rs.
Sundry Creditors		2000	Cash		74000
Capital Accounts			Stock		36000
Vimal	62000		Plant and Machinery		35000
Nirmal	4000		Debtors	18000
Kailash	40000	142000	Less Provision for sacrifice debts	1000	17000
		162000			162000

Working Note
Old Share – New share
Vimal’s sacrifice = Old share – new share
                         = 3/5 – 2/4
                         = 2/20
Nirmal’s sacrifice = 2/5 – 1/4
                            = 3/20
S.R. = 2 : 3

 

https://tutorstips.com/what-is-partnership/

T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)

• Chapter No. 1 - Financial Statement of Not-For-Profit Organisations
• Chapter No. 2 - Accounting for Partnership Firms - Fundamentals
• Chapter No. 3 - Goodwill: Nature and Valuation
• Chapter No. 4 - Change in Profit-Sharing Ratio Among the Existing Partners
• Chapter No. 5 - Admission of a Partner
• Chapter No. 6 - Retirement/Death of a Partner
• Chapter No. 7 - Dissolution of a Partnership Firm

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

• Chapter No. 8 - Company Accounts -  Accounting for Share Capital
• Chapter No. 9 - Company Accounts - Issue of Debentures
• Chapter No. 10 - Redemption of Debentures

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

• Chapter No. 1 - Financial Statements of a Company
• Chapter No. 2 - Financial Statement Analysis 
• Chapter No. 3 - Tools of Financial Statement Analysis - Comparative Statements and Common- Size Statements
• Chapter No. 4 - Accounting Ratios
• Chapter No. 5 - Cash Flow Statement

Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication