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Question 54 Chapter 6 of +2-A
54. A B and C are partners sharing profits in the ratio of 5 : 3: 2. Their Balance Sheet as on 31st March 2018 is given below:
| Liabilities | Amount | Assets | Amount | |
| Capital A/cs: | Building | 18,00,000 | ||
| A | 11,00,000 | Investments | 4,00,000 | |
| B | 11,40,000 | Stock | 6,00,000 | |
| C | 7,60,000 | 30,00,000 | Debtors | 10,00,000 |
| Workmen Compensation Reserve | 10,00,000 | Cash and Bank | 6,00,000 | |
| Creditors | 2,00,000 | |||
| Employees' Provident Fund | 2,00,000 | |||
| 44,00,000 | 44,00,000 |
C retires on 30th June, 2018 and it was mutually agreed that:
a Building be valued at 22,00,000.
b Investments to be valued at 3,00,000.
c Stock be taken at 8,00,000.
d Goodwill of the firm be valued at two years' purchase of the average profit of the past five years.
e C's share of profits up to the date of retirement be calculated on the basis of average profit of the preceding three years.
The profits of the preceding five years were as under:
| Year | 2013-14 | 2014-15 | 2015-16 | 2016-17 | 2017-18 |
| Profits | 4,00,000 | 5,00,000 | 6,00,000 | 8,00,000 | 7,00,000 |
f Amount payable to C to be transferred to his Loan Account carrying interest @ 10% p.a. Prepare Revaluation Account, Partners' Capital Accounts and the Balance Sheet as at 30th June, 2018.
Revaluation Account
| Particular |
Amount | Particular | Amount | ||
|---|---|---|---|---|---|
| To Investments | 1,00,000 | By Building | 4,00,000 | ||
| Stock | 2,00,000 | ||||
| Profit transferred to: | |||||
| A’s Capital A/c | 2,50,000 | ||||
| B’s Capital A/c | 1,50,000 | ||||
| C’s Capital A/c | 1,00,000 | 5,00,000 | |||
| 6,00,000 | 6,00,000 | ||||
Partners’ Capital Account
| Part. | X | Y | Z |
Part. |
X | Y | Z |
|---|---|---|---|---|---|---|---|
| To C’s Capital A/c | 1,50,000 | 90,000 | - | By Balance B/d | 11,00,000 | 11,40,000 | 7,60,000 |
| To C’s Loan A/c | - | - | 13,35,000 | By Re valua tion A/c |
2,50,000 | 1,50,000 | 1,00,000 |
| By A’s Capital A/c | - | - | 1,50,000 | ||||
| By B’s Capital A/c | - | - | 90,000 | ||||
| By Work men Com pensa tion Reserve A/c* |
5,00,000 |
3,00,000 |
2,00,000 | ||||
| By P & L Sus pense A/c |
- | - | 35,000 | ||||
| To Balance c/d | 17,00,000 | 15,00,000 | - | ||||
| 18,50,000 | 15,90,000 | 13,35,000 | 18,50,000 | 15,90,000 | 13,35,000 |
Balance Sheet
| Liabilities |
Amount | Assets | Amount | ||
|---|---|---|---|---|---|
| Creditors | 2,00,000 | Building | 22,00,000 | ||
| Employees’ Provident Fund | 2,00,000 | Investments | 3,00,000 | ||
| C’s Loan A/c | 13,35,000 | Stock | 8,00,000 | ||
| Capital: | Debtors | 10,00,000 | |||
| A | 17,00,000 | Cash and Bank | 6,00,000 | ||
| B | 15,00,000 | 32,00,000 | P&L Suspense Account | 35,000 | |
| 49,35,000 | 49,35,000 | ||||
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.
This guide covers "Q.No.54 | Chapter 6 – Retirement/Death of a Partner | T.S. Grewal 12 Class Book Keeping Part - A - Vol. 1", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to T.S. Grewal 12 Class Book Keeping Part - A - Vol. 1.
It is primarily curated for Class 11 and Class 12 high school commerce, accounting, and economics students, as well as aspirants preparing for board exams or CA Foundation.
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