Chapter No. 4 - Partnership Accounts – III (Reconstitution of Partnership) Archives

Question 26 Chapter 4 of +2 Part-1 – USHA Publication 12 Class Parat – 1

January 31, 2021January 30, 2021 Shubham Sharma

Question 26 Chapter 4 of +2-Part-1

26. (Adjustment of Capital) A, B and C were partners, sharing profits and losses in 4:3:2 ratio respectively. They changed their profit sharing ratio to 2:4:3. On 31st March 2018, when their capitals after necessary adjustments stood at Rs.39,300; Rs.39,600 and Rs.18,300 respectively. The entire capital of the newly constituted firm is fixed at Rs.1,08,000 as per new profit sharing ratio. Calculate the actual cash to be paid off or to be brought in by the partners and pass necessary journal entries.

The solution of Question 26 Chapter 4 of +2 Part-1: –

Total capital of Reconstituted Firm = Rs.1,08,000

Particular	A	B	C
New profit sharing ratio = 2:4:3
A’s Capital (1,08,000*2/9)	24,000	–	–
B’s Capital (1,08,000*4/9)	–	48,00	–
C’s Capital (1,08,000*3/9)	–	–	36,000

(ii) Calculation of cash to be brought in or paid off to partners:

Particular	A	B	C
Partners’ capitals in Reconstituted firm	24,000	48,000	36,000
Existing capitals of partners	39,300	39,600	18,300
Cash to be brought/paid off	(15,300)	(8,400)	(17,700)
C’s Capital (1,08,000*3/9)	Paid off	Brought	Brought

In the Books of _______________
Date	Particulars		L.F.	Debit	Credit

(i)	A’s Capital a/c	Dr.		15,300
	To Cash a/c				15,300
	(Being excess capital withdrawn by partner)

(ii)	Cash a/c	Dr.		26,100
	To B’s Capital a/c				8,400
	To C’s Capital a/c				17,700
	(Being shortage in the capital brought in by partners)

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Also, Check out the solved question of previous Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Chapter No. 1 – Accounting Not for Profit Organisations

Chapter No. 2 – Partnership Accounts – I

Chapter No. 3 – Partnership Accounts – II (Introduction)

Chapter No. 4 – Partnership Accounts – III (Goodwill: Nature and Valuation)

Chapter No. 5 – Partnership Accounts – IV (Reconstitution of Partnership)

Chapter No. 6 – Partnership Accounts – V (Admission of A Partner)

Chapter No. 7 – Partnership Accounts – VI (Retirement and Death of A Partner)

Chapter No. 8 – Company Accounts (Share Capital)

Chapter No. 9 – Company Accounts (Issue of Debentures)

Chapter No. 10 – Company Accounts (Redemption of Debentures)

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

Chapter No. 1 – Financial Statements of a Company (Balance Sheet Only)

Chapter No. 2 – Techniques of Financial Statement Analysis

Chapter No. 3 – Ratio Analysis

Chapter No. 4 – Cash Flow Statement

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

2 Book 1 min - Question 26 Chapter 4 of +2 Part-1 - USHA Publication 12 Class Parat - 1 — Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

Question 25 Chapter 4 of +2 Part-1 – USHA Publication 12 Class Parat – 1

January 31, 2021January 30, 2021 Shubham Sharma

Question 25 Chapter 4 of +2-Part-1

25. (Journal/ Capital a/c/ Balance sheet) X and Y are partners sharing profits in 4:3 ratio. The balance sheet as on 31st March 2018 was as follows:

Liabilities		Amount	Assets	Amount
Reserves		21,000	Fixed assets	75,000
Sundry creditors		14,000	Sundry Debtors	60,000
Capital A/c			Cash in hand	10,000
X	1,20,000		Stock	70,000
Y	60,000	1,80,000
		2,15,000		2,15,000

They decided that with effect from 1st April 2018, they will share profits and losses in the ratio of 2:1. For this purpose, they decided that:

Fixed assets to be depreciated by 10%.
A provision of 6% is made on debtors for doubtful debts.
Stock is valued at Rs.95,000.
An amount of Rs.1,850 included in creditors is not likely to be claimed.
Partners decide to record the revised values in the books. However, they do not want to disturb the reserve. You are required to pass the journal entries, prepare the capital accounts of partners and the revised balance sheet.

The solution of Question 25 Chapter 4 of +2 Part-1: –

Old Ratio of X & Y	=	4: 3
New Ratio of X & Y	=	2: 1

Calculate the Sacrificing or Gaining Ratio of Partners
Sacrificing or Gaining Ratio = Old Ratio – New Ratio

X’s Share Sacrificing/Gaining	=	4	–	2
		7		3

	=	12 – 14
	=	21

	=	-2	(Gaining)
		21

Y’s Share Sacrificing/Gaining	=	3	–	1
		7		3

	=	9 – 7
	=	21

	=	2	(Sacrifice)
		21

In the Books of _______________
Date	Particulars		L.F.	Debit	Credit

(i)	Revaluation a/c	Dr.		11,100
	To Provision for doubtful debts a/c				7,500
	To Fixed assets a/c				3,600
	(Being assets revalued)

(ii)	Stock a/c	Dr.		25,000
	Sundry Creditors a/c	Dr.		1,850
	To Revaluation a/c				26,850
	(Being revaluation of assets and liabilities)

(iii)	Revaluation a/c	Dr.		1,380
	To X’s Capital a/c (Rs.15,750*4/7)				1,600
	To Y’s Capital a/c (Rs.15,750*3/7)				700
	(Being profit on revaluation distributed in 4:3 ratio)

(iv)	X’s Capital a/c (21,000*2/21)	Dr.		2,000
	To Y’s Capital a/c				2,000
	(Being adjustment in the capital for reserve due to change in profit ratio)

Partners’ Capital Accounts
Particular	X	Y	Particular	X	Y
To Y’s Capital a/c	2,000	–	By Balance B/d	1,20,000	60,000
			By Revaluation a/c	9,000	6,750
			By Revaluation a/c	–	2,000
To Balance c/d	1,27,000	68,750
	1,29,000	68,750		1,29,000	68,750

Balance Sheets
Liabilities		Amount	Assets		Amount
Capital A/c			Fixed Assets		67,500
X	17,400		Sundry Debtors:	60,000
Y	10,700	37,000	Less: Provision for D/D	3,600	56,400
Reserve		21,000	Stock		95,000
Sundry Creditors		12,150	Cash in hand		10,000


		2,28,900			2,28,900

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Also, Check out the solved question of previous Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Chapter No. 1 – Accounting Not for Profit Organisations

Chapter No. 2 – Partnership Accounts – I

Chapter No. 3 – Partnership Accounts – II (Introduction)

Chapter No. 4 – Partnership Accounts – III (Goodwill: Nature and Valuation)

Chapter No. 5 – Partnership Accounts – IV (Reconstitution of Partnership)

Chapter No. 6 – Partnership Accounts – V (Admission of A Partner)

Chapter No. 7 – Partnership Accounts – VI (Retirement and Death of A Partner)

Chapter No. 8 – Company Accounts (Share Capital)

Chapter No. 9 – Company Accounts (Issue of Debentures)

Chapter No. 10 – Company Accounts (Redemption of Debentures)

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

Chapter No. 1 – Financial Statements of a Company (Balance Sheet Only)

Chapter No. 2 – Techniques of Financial Statement Analysis

Chapter No. 3 – Ratio Analysis

Chapter No. 4 – Cash Flow Statement

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

2 Book 1 min - Question 25 Chapter 4 of +2 Part-1 - USHA Publication 12 Class Parat - 1 — Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

Question 24 Chapter 4 of +2 Part-1 – USHA Publication 12 Class Part – 1

January 30, 2021January 28, 2021 Shubham Sharma

Question 24 Chapter 4 of +2-Part-1

24. (Revaluation entries/ Capital a/c/ Balance sheet) X, Y and Z are partners in 6:3:1 ratio. Their balance sheet was as under on the date of change of profit ratio which is 2:1:2 for future.

Liabilities		Amount	Assets	Amount
Reserves		6,000	Cash at bank	2,400
Workmen Compensation Reserve		3,000	Building	16,000
Bank loan		9,000	Investments	6,000
Capital A/c			Stock	4,000
X	12,000		Debtors	3,600
Y	8,000		Machinery	14,000
Z	8,000	28,000
		46,000		46,000

The following evaluations were made:

Goodwill valued at Rs.4,000.
A bank loan was reduced to Rs.8,000.
The building is decreased by 10% and machinery is valued at 95% of book value.
Pass entries without opening revaluation account. Prepare Capital account and Balance Sheet.

The solution of Question 24 Chapter 4 of +2 Part-1: –

In the Books of _______________
Date	Particulars		L.F.	Debit	Credit

(i)	Goodwill a/c	Dr.		4,000
	Bank Loan a/c	Dr.		1,000
	To X’s Capital a/c				3,000
	To Y’s Capital a/c				1,500
	To Z’s Capital a/c				500
	(Being revaluation of assets and liabilities)

(ii)	X’s Capital a/c	Dr.		1,380
	Y’s Capital a/c	Dr.		690
	Z’s Capital a/c	Dr.		230
	To Building a/c				1,600
	To Machinery				700
	(Being assets revalued)

(iii)	X’s Capital a/c	Dr.		3,000
	Y’s Capital a/c	Dr.		1,500
	Z’s Capital a/c	Dr.		500
	To Goodwill a/c				4,000
	To Bank Loan a/c				1,000
	(Being revaluation of assets and liabilities)

(iv)	Building a/c	Dr.		1,600
	Machinery a/c	Dr.		700
	To X’s Capital a/c				1,380
	To Y’s Capital a/c				690
	To Z’s Capital a/c				230
	(Being revaluation of assets and liabilities)

Partners’ Capital Accounts
Particular	X	Y	Z	Particular	X	Y	Z
To Memorandum Revaluation a/c	1,380	690	230	By Balance B/d	12,000	8,000	8,000
To Goodwill a/c				By Goodwill a/c	3,000	1,500	500
				By building and machinery a/c	1,380	690	230
				By reserve a/c	3,600	1,800	600
				By Workmen Comp. Reserve	1,800	900	300
To Balance c/d	17,400	10,700	8,900
	21,780	12,890	9,630		21,780	12,890	9,630

Balance Sheets
Liabilities		Amount	Assets	Amount
Capital A/c			Cash at bank	2,400
X	17,400		Building	16,000
Y	10,700		Stock	4,000
Z	8,900	37,000	Debtors	3,600
Bank Loan		9,000	Furniture	25,000
			Machinery	14,000


		46,000		46,000

Thanks, Please Like and share with your friends

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Also, Check out the solved question of previous Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Chapter No. 1 – Accounting Not for Profit Organisations

Chapter No. 2 – Partnership Accounts – I

Chapter No. 3 – Partnership Accounts – II (Introduction)

Chapter No. 4 – Partnership Accounts – III (Goodwill: Nature and Valuation)

Chapter No. 5 – Partnership Accounts – IV (Reconstitution of Partnership)

Chapter No. 6 – Partnership Accounts – V (Admission of A Partner)

Chapter No. 7 – Partnership Accounts – VI (Retirement and Death of A Partner)

Chapter No. 8 – Company Accounts (Share Capital)

Chapter No. 9 – Company Accounts (Issue of Debentures)

Chapter No. 10 – Company Accounts (Redemption of Debentures)

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

Chapter No. 1 – Financial Statements of a Company (Balance Sheet Only)

Chapter No. 2 – Techniques of Financial Statement Analysis

Chapter No. 3 – Ratio Analysis

Chapter No. 4 – Cash Flow Statement

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

2 Book 1 min - Question 24 Chapter 4 of +2 Part-1 - USHA Publication 12 Class Part - 1 — Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

Question 23 Chapter 4 of +2 Part-1 – USHA Publication 12 Class Part – 1

January 30, 2021January 28, 2021 Shubham Sharma

Question 23 Chapter 4 of +2-Part-1

23. (Revaluation by passing a single adjustment entry) P, Q and R are sharing profits and losses in the ratio of 5:3:2. They decided to share future profits and losses in the ratio of 2:3:5 with effect from 1st April,2016. They also decided to record the effect of following revaluations without affecting the book value of assets and liabilities by passing a single adjustment entry:

	Book Value	Revalued Amount
Land & Building	2,00,000	3,00,000
Equipment	3,00,000	2,80,000
Bank Loan	1,00,000	90,000
Outstanding salaries	90,000	1,20,000

The solution of Question 23 Chapter 4 of +2 Part-1: –

In the Books of _______________
Date	Particulars		L.F.	Debit	Credit

	R’s Capital a/c	Dr.		18,000
	To P’s Capital a/c				18,000
	(Being revaluation of assets and liabilities adjusted through capital accounts)

Working Notes: –

Adjustment for revaluation of assets on change in profit sharing ratio:
Particular	P	Q	R
As per old ratio 5:3:2
Land & Building	50,000(Cr.)	30,000(Cr)	20,000(cr)
Equipment	10,000(Dr.)	6,000(Dr.)	4,000(Dr.)
Bank Loan	5,000(Cr.)	3,000(Cr.)	2,000(Cr.)
Outstanding Salaries	15,000(Cr.)	9,000(Cr.)	6,000(Cr.)
Total	30,000(Cr.)	18,000(Cr.)	12,000(Cr.)

Adjustment for revaluation of assets on change in profit sharing ratio:
Particular	P	Q	R
As per New ratio 2:3:5
Land & Building	20,000(Cr.)	30,000(Cr)	50,000(cr)
Equipment	4,000(Dr.)	6,000(Dr.)	6,000(Dr.)
Bank Loan	2,000(Cr.)	3,000(Cr.)	5,000(Cr.)
Outstanding Salaries	6,000(Cr.)	9,000(Cr.)	15,000(Cr.)
Total	30,000(Cr.)	18,000(Cr.)	12,000(Cr.)
Adjustment	18,000(Cr.)		18,000(CD.)

Thanks, Please Like and share with your friends

Comment if you have any questions.

Also, Check out the solved question of previous Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Chapter No. 1 – Accounting Not for Profit Organisations

Chapter No. 2 – Partnership Accounts – I

Chapter No. 3 – Partnership Accounts – II (Introduction)

Chapter No. 4 – Partnership Accounts – III (Goodwill: Nature and Valuation)

Chapter No. 5 – Partnership Accounts – IV (Reconstitution of Partnership)

Chapter No. 6 – Partnership Accounts – V (Admission of A Partner)

Chapter No. 7 – Partnership Accounts – VI (Retirement and Death of A Partner)

Chapter No. 8 – Company Accounts (Share Capital)

Chapter No. 9 – Company Accounts (Issue of Debentures)

Chapter No. 10 – Company Accounts (Redemption of Debentures)

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

Chapter No. 1 – Financial Statements of a Company (Balance Sheet Only)

Chapter No. 2 – Techniques of Financial Statement Analysis

Chapter No. 3 – Ratio Analysis

Chapter No. 4 – Cash Flow Statement

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

2 Book 1 min - Question 23 Chapter 4 of +2 Part-1 - USHA Publication 12 Class Part - 1 — Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

Question 22 Chapter 4 of +2 Part-1 – USHA Publication 12 Class Part – 1

January 29, 2021January 28, 2021 Shubham Sharma

Question 22 Chapter 4 of +2-Part-1

22. (Preparation of B/S) The following is the Balance sheet of A, B and C as on 31st March 2018. The partner share profits in 4:3:3 and they have decided to share profit in 2:2:1 ratio with effect from 1st April 2018.

Liabilities	Amount	Assets	Amount
Capital:		Cash	25,000
A	1,50,000	Debtors	62,500
B	1,75,000	B/R	37,500
C	1,25,000	Stock	1,00,000
Creditors	1,00,000	Furniture	25,000
		Machinery	1,75,000
		Goodwill	1,25,000
	5,50,000		5,50,000

The following revaluation were made:
Goodwill Rs.1,50,000; Stock Rs.1,05,000; Provision for D/D is required Rs.5,000; Machinery is decreased by Rs.30,000; Creditors have been reduced by Rs.20,000.
The partners do not want to alter the figures of assets and liabilities. Pass adjustment entry and prepare Balance Sheet.

The solution of Question 22 Chapter 4 of +2 Part-1: –

In the Books of _______________
Date	Particulars		L.F.	Debit	Credit

(i)	Goodwill a/c	Dr.		25,000
	Stock	Dr.		5,000
	To Revaluation a/c				30,000
	(Being revaluation of assets and liabilities)

	Creditors	Dr.		20,000
	To Revaluation a/c				20,000
	(Being revaluation of assets and liabilities)

(ii)	Revaluation a/c	Dr.		5,000
	To Provision for doubtful debts a/c				5,000
	(Being revaluation of assets and liabilities)

	Revaluation a/c	Dr.		30,000
	To Machinery				30,000
	(Being revaluation of assets and liabilities)

(iii)	Revaluation a/c	Dr.		15,000
	To A’s Capital a/c				6,000
	To B’s Capital a/c				4,500
	To C’s Capital a/c				4,500
	(Being profit on revaluation distributed)

(iv)	Memorandum Revaluation a/c	Dr.		50,000
	To Goodwill				25,000
	To Stock				5,000
	To Creditors				20,000
	(Being revaluation entry reversed)

(v)	Provision for doubtful debts a/c	Dr.		5,000
	Machinery	Dr.		30,000
	To Revaluation a/c				35,000
	(Being revaluation entry reversed)

(vi)	A’s Capital a/c	Dr.		6,000
	B’s Capital a/c	Dr.		6,000
	C’s Capital a/c	Dr.		3,000
	To Memorandum Revaluation a/c				15,000
	(Being revaluation entry reversed)

Partners’ Capital Accounts
Partic ular	A	B	C	Partic ular	A	B	C
To Memorandm Revalua tion a/c	6,000	6,000	3,000	By Balance B/d	1,50,000	1,75,000	1,25,000
				By Revaluatin a/c	6,000	4,500	4,500
To Balance c/d	1,50,000	1,73,500	1,26,500
	1,56,000	1,79,500	1,29,500		1,56,000	1,79,500	1,29,500

Balance Sheets
Liabilities		Amount	Assets	Amount
Capital A/c			Cash	25,000
A	1,50,000		Bills Receivables	37,500
B	1,73,500		Stock	1,00,000
C	1,.26,500	4,50,000	Debtors	62,500
Creditors		1,00,000	Furniture	25,000
			Machinery	1,75,000
			Goodwill	1,25,000

		5,50,000		5,50,000

Thanks, Please Like and share with your friends

Comment if you have any questions.

Also, Check out the solved question of previous Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Chapter No. 1 – Accounting Not for Profit Organisations

Chapter No. 2 – Partnership Accounts – I

Chapter No. 3 – Partnership Accounts – II (Introduction)

Chapter No. 4 – Partnership Accounts – III (Goodwill: Nature and Valuation)

Chapter No. 5 – Partnership Accounts – IV (Reconstitution of Partnership)

Chapter No. 6 – Partnership Accounts – V (Admission of A Partner)

Chapter No. 7 – Partnership Accounts – VI (Retirement and Death of A Partner)

Chapter No. 8 – Company Accounts (Share Capital)

Chapter No. 9 – Company Accounts (Issue of Debentures)

Chapter No. 10 – Company Accounts (Redemption of Debentures)

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

Chapter No. 1 – Financial Statements of a Company (Balance Sheet Only)

Chapter No. 2 – Techniques of Financial Statement Analysis

Chapter No. 3 – Ratio Analysis

Chapter No. 4 – Cash Flow Statement

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

2 Book 1 min - Question 22 Chapter 4 of +2 Part-1 - USHA Publication 12 Class Part - 1 — Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

Question 21 Chapter 4 of +2 Part-1 – USHA Publication 12 Class Part – 1

January 29, 2021January 27, 2021 Shubham Sharma

Question 21 Chapter 4 of +2-Part-1

21. (Revaluation account) Prepare revaluation account of a firm of partner A and B:
Creditors gave up claim Rs.4,000; Bills payable reduced by Rs.2,000; Salary outstanding not yet recorded in the books Rs.500; Building Rs.1,00,000 increased to Rs.1,10,000; Machinery Rs.50,000; Half of the machinery was valued at Rs.28,000 and the other half was written off by Rs.7,000; Prepaid Insurance Rs.1,500 not yet recorded in the books.

The solution of Question 21 Chapter 4 of +2 Part-1: –

Revaluation A/c
Particular		Amount	Particular	Amount
To Outstanding salary		500	By Creditors	4,000
To machinery		7,000	By Bills Payable	2,000
			By Building	10,000
			By Machinery	3,000
			By Prepaid insurance	1,500
To profit on revaluation:
-A (1/2)	6,500
-B (1/2)	6,500	13,000
		20,500		20,500

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Also, Check out the solved question of previous Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Chapter No. 1 – Accounting Not for Profit Organisations

Chapter No. 2 – Partnership Accounts – I

Chapter No. 3 – Partnership Accounts – II (Introduction)

Chapter No. 4 – Partnership Accounts – III (Goodwill: Nature and Valuation)

Chapter No. 5 – Partnership Accounts – IV (Reconstitution of Partnership)

Chapter No. 6 – Partnership Accounts – V (Admission of A Partner)

Chapter No. 7 – Partnership Accounts – VI (Retirement and Death of A Partner)

Chapter No. 8 – Company Accounts (Share Capital)

Chapter No. 9 – Company Accounts (Issue of Debentures)

Chapter No. 10 – Company Accounts (Redemption of Debentures)

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

Chapter No. 1 – Financial Statements of a Company (Balance Sheet Only)

Chapter No. 2 – Techniques of Financial Statement Analysis

Chapter No. 3 – Ratio Analysis

Chapter No. 4 – Cash Flow Statement

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

2 Book 1 min - Question 21 Chapter 4 of +2 Part-1 - USHA Publication 12 Class Part - 1 — Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

Question 20 Chapter 4 of +2 Part-1 – USHA Publication 12 Class Part – 1

January 28, 2021January 26, 2021 Shubham Sharma

Question 20 Chapter 4 of +2-Part-1

20. (Revaluation account) A, B and C are partners in 3:2:1 ratio. On 31st March, 2018 the following revaluation were made:
Furniture Rs.25,000, revalued at Rs.22,000; Stock Rs.10,000, revalued at Rs.4,000; Debtors Rs.40,000, Provision required for doubtful debts @10%. Unrecorded liabilities Rs.1,000.
General Reserve was Rs.12,000. The partners have decided to change the ratio. The new ratio will be equal. General Reserve account is not to be closed.
Pass journal entries and prepare revaluation account.

The solution of Question 20 Chapter 4 of +2 Part-1: –

In the Books of _______________
Date	Particulars		L.F.	Debit	Credit

(i)	Revaluation a/c	Dr.		14,000
	To Furniture A/c				3,000
	To Stock A/c				6,000
	To Provision for doubtful debts a/c				4,000
	To unrecorded liabilities a/c				1,000
	(Being revaluation of assets and liabilities)				15,000

(ii)	A’s Capital a/c	Dr.		7,000
	B’s Capital a/c	Dr.		4,667
	C’s Capital a/c	Dr.		2,333
	To Revaluation a/c				14,000
	(Being loss on revaluation distributed)

(iii)	General Reserve a/c	Dr.		12,000
	To A’s Capital a/c				6,000
	To B’s Capital a/c				4,000
	To C’s Capital a/c				2,000
	(Being revaluation of assets and liabilities)

(iv)	A’s Capital a/c	Dr.		4,000
	B’s Capital a/c	Dr.		4,000
	C’s Capital a/c	Dr.		4,000
	To General Reserve a/c				12,000
	(Being loss on revaluation distributed)

Revaluation A/c
Particular	Amount	Particular		Amount
To Furniture a/c (decrease)	3,000
To Stock (decrease)	6,000
To Prov. for doubtful debts (increase)	4,000
To unrecorded liability	1,000
		By loss on revaluation transferred to:
		-A	7,000
		-B	4,667
		-C	2,333	14,000
	14,000			14,000

Thanks, Please Like and share with your friends

Comment if you have any questions.

Also, Check out the solved question of previous Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Chapter No. 1 – Accounting Not for Profit Organisations

Chapter No. 2 – Partnership Accounts – I

Chapter No. 3 – Partnership Accounts – II (Introduction)

Chapter No. 4 – Partnership Accounts – III (Goodwill: Nature and Valuation)

Chapter No. 5 – Partnership Accounts – IV (Reconstitution of Partnership)

Chapter No. 6 – Partnership Accounts – V (Admission of A Partner)

Chapter No. 7 – Partnership Accounts – VI (Retirement and Death of A Partner)

Chapter No. 8 – Company Accounts (Share Capital)

Chapter No. 9 – Company Accounts (Issue of Debentures)

Chapter No. 10 – Company Accounts (Redemption of Debentures)

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

Chapter No. 1 – Financial Statements of a Company (Balance Sheet Only)

Chapter No. 2 – Techniques of Financial Statement Analysis

Chapter No. 3 – Ratio Analysis

Chapter No. 4 – Cash Flow Statement

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

2 Book 1 min - Question 20 Chapter 4 of +2 Part-1 - USHA Publication 12 Class Part - 1 — Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

Question 19 Chapter 4 of +2 Part-1 – USHA Publication 12 Class Part – 1

January 28, 2021January 26, 2021 Shubham Sharma

Question 19 Chapter 4 of +2-Part-1

19. (Revaluation entries) X and Y share profits in 6:7 ratio. The future ratio will be 4:3 from 1st April 2018. They have decided to make a revaluation of assets and liabilities by passing revaluation entries before bringing into force the new ratio.
The following is the position of assets on 1st April 2018 with their revised values

	Book Value	Revised Value
Building	50,000	55,200
Machinery	25,000	22,400
Creditors	28,000	29,300
Stock	29,000	32,900

The solution of Question 19 Chapter 4 of +2 Part-1: –

(i) If there is no other information.

In the Books of _______________
Date	Particulars		L.F.	Debit	Credit

(i)	Building a/c (Increase: Rs.55,200-50,000)	Dr.		5,200
	Stock a/c (Increase: Rs.32,900-29,000)	Dr.		3,900
	To Revaluation A/c				9,100
	(Being assets revalued at profit)				15,000

(ii)	Revaluation a/c	Dr.		3,900
	To machinery A/c (Decrease: Rs.25,000-22,400)				2,600
	To creditors a/c (Increase: Rs.29,300-28,000)				1,300
	(Being revaluation of assets and liabilities)

(ii)	Revaluation a/c (Rs.9,100-3,900)	Dr.		5,200
	To X’s Capital a/c				2,400
	To Y’s Capital a/c				2,800
	(Being revaluation of assets and liabilities)

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Also, Check out the solved question of previous Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Chapter No. 1 – Accounting Not for Profit Organisations

Chapter No. 2 – Partnership Accounts – I

Chapter No. 3 – Partnership Accounts – II (Introduction)

Chapter No. 4 – Partnership Accounts – III (Goodwill: Nature and Valuation)

Chapter No. 5 – Partnership Accounts – IV (Reconstitution of Partnership)

Chapter No. 6 – Partnership Accounts – V (Admission of A Partner)

Chapter No. 7 – Partnership Accounts – VI (Retirement and Death of A Partner)

Chapter No. 8 – Company Accounts (Share Capital)

Chapter No. 9 – Company Accounts (Issue of Debentures)

Chapter No. 10 – Company Accounts (Redemption of Debentures)

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

Chapter No. 1 – Financial Statements of a Company (Balance Sheet Only)

Chapter No. 2 – Techniques of Financial Statement Analysis

Chapter No. 3 – Ratio Analysis

Chapter No. 4 – Cash Flow Statement

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

2 Book 1 min - Question 19 Chapter 4 of +2 Part-1 - USHA Publication 12 Class Part - 1 — Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

Question 18 Chapter 4 of +2 Part-1 – USHA Publication 12 Class Part – 1

January 27, 2021January 26, 2021 Shubham Sharma

Question 18 Chapter 4 of +2-Part-1

18. (Treatment of Workmen Compensation Reserve) X, Y and Z are partners in 2:3:1 ratio. The new ratio will be 1:2:3. Extract of the balance sheet was followed:

Liabilities	Amount
Workmen Compensation Reserve	30,000

Show accounting treatment in each of the following:

If there is no other information .
If a claim on account of workmen compensation in due Rs.6,000.
If a claim on account of workmen compensation in due Rs.33,000.

The solution of Question 18 Chapter 4 of +2 Part-1: –

(i) If there is no other information.

In the Books of _______________
Date	Particulars		L.F.	Debit	Credit

	Workmen Compensation Reserve a/c	Dr.		30,000
	To X’s Capital A/c (1,08,000*5/30)				10,000
	To Y’s Capital A/c (1,08,000*5/30)				15,000
	To Z’s Capital A/c (1,08,000*5/30)				5,000
	(Being WCR credited in 2:3:1 ratio)

(ii) If a claim on account of workmen compensation in due Rs.6,000.

In the Books of _______________
Date	Particulars		L.F.	Debit	Credit

	Workmen Compensation Reserve a/c	Dr.		30,000
	To Claim Payable A/c				6,000
	To X’s Capital A/c				8,000
	To Y’s Capital A/c				12,000
	To Z’s Capital A/c				4,000
	(Being WCR credited in 2:3:1 ratio)

(iii) If a claim on account of workmen compensation in due Rs.33,000.

In the Books of _______________
Date	Particulars		L.F.	Debit	Credit

	Revaluation a/c	Dr.		3,000
	Workmen Compensation Reserve a/c	Dr.		30,000
	To Claim Payable A/c				33,000
	(Being claim payable)

	X’s Capital A/c	Dr.		1,000
	Y’s Capital A/c	Dr.		1,500
	Z’s Capital A/c	Dr.		500
	To Revaluation A/c				3,000
	(Being WCR credited in 2:3:1 ratio)

Thanks, Please Like and share with your friends

Comment if you have any questions.

Also, Check out the solved question of previous Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Chapter No. 1 – Accounting Not for Profit Organisations

Chapter No. 2 – Partnership Accounts – I

Chapter No. 3 – Partnership Accounts – II (Introduction)

Chapter No. 4 – Partnership Accounts – III (Goodwill: Nature and Valuation)

Chapter No. 5 – Partnership Accounts – IV (Reconstitution of Partnership)

Chapter No. 6 – Partnership Accounts – V (Admission of A Partner)

Chapter No. 7 – Partnership Accounts – VI (Retirement and Death of A Partner)

Chapter No. 8 – Company Accounts (Share Capital)

Chapter No. 9 – Company Accounts (Issue of Debentures)

Chapter No. 10 – Company Accounts (Redemption of Debentures)

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

Chapter No. 1 – Financial Statements of a Company (Balance Sheet Only)

Chapter No. 2 – Techniques of Financial Statement Analysis

Chapter No. 3 – Ratio Analysis

Chapter No. 4 – Cash Flow Statement

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

2 Book 1 min - Question 18 Chapter 4 of +2 Part-1 - USHA Publication 12 Class Part - 1 — Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

Question 17 Chapter 4 of +2 Part-1 – USHA Publication 12 Class Part – 1

January 27, 2021January 26, 2021 Shubham Sharma

Question 17 Chapter 4 of +2-Part-1

17. (Comprehensive Illustration) X,Y and Z are sharing profits and losses in 5:3:2 ratio. They agreed to share profits and losses in the ratio of 2:3:5 with effect from 1st April 2019. They also decide to record the effect of the following accumulated profits, losses and reserves without effecting their book figures by passing a single entry.

	Book figures (in Rs.)
General Reserve	6,000
Profit & Loss account	24,000
Advertisement Suspense account	12,000

Pass the necessary single adjustment entry.

The solution of Question 17 Chapter 4 of +2 Part-1: –

In the Books of _______________
Date	Particulars		L.F.	Debit	Credit

	Z’s Capital A/c	Dr.		5,400
	To X’s Capital A/c				5,400
	(Being profits adjusted on account of change in profit ratio)

Working Notes: –

Old Ratio = 5 : 3 : 2
New Ratio = 2 : 3 : 5
Calculate the Sacrificing or Gaining Ratio of Partners
Sacrificing or Gaining Ratio = Old ratio – New ratio

X’s Share Sacrificing/Gaining	=	5	–	2
		10		10

	=	5- 2
	=	10

	=	3	(Sacrificing)
		10

Y’s Share Sacrificing/Gaining	=	3	–	3
		10		10

	=	3 – 3
	=	10

	=	0	(Nil)
		10

Z’s Share Sacrificing/Gaining	=	2	–	5
		10		10

	=	2 – 5
	=	10

	=	-3	(Gaining)
		10

Calculation of total adjustment profit
Particulars		Amount

General Reserve		6,000
Profit & Loss account (Profit)		24,000
Advertisement Suspense account		(-)12,000
Total adjustment profit		18,000

Thanks, Please Like and share with your friends

Comment if you have any questions.

Also, Check out the solved question of previous Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Chapter No. 1 – Accounting Not for Profit Organisations

Chapter No. 2 – Partnership Accounts – I

Chapter No. 3 – Partnership Accounts – II (Introduction)

Chapter No. 4 – Partnership Accounts – III (Goodwill: Nature and Valuation)

Chapter No. 5 – Partnership Accounts – IV (Reconstitution of Partnership)

Chapter No. 6 – Partnership Accounts – V (Admission of A Partner)

Chapter No. 7 – Partnership Accounts – VI (Retirement and Death of A Partner)

Chapter No. 8 – Company Accounts (Share Capital)

Chapter No. 9 – Company Accounts (Issue of Debentures)

Chapter No. 10 – Company Accounts (Redemption of Debentures)

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

Chapter No. 1 – Financial Statements of a Company (Balance Sheet Only)

Chapter No. 2 – Techniques of Financial Statement Analysis

Chapter No. 3 – Ratio Analysis

Chapter No. 4 – Cash Flow Statement

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