Question 16 Chapter 4 of +2-A – T.S. Grewal 12 Class Part – A Vol. 1

Question 16 Chapter 4 of +2-A

Question 16 Chapter 4 of +2-A

16. X, Y and Z who are sharing profits in the ratio of 5 : 3 : 2, decide to share
profits in the ratio of 2 : 3 : 5 with effect from 1st April, 2019. Workmen Compensation Reserve appears at 1,20,000 in the Balance Sheet as at 31st March, 2019 and Workmen Compensation Claim is estimated at 1,50,000. Pass Journal entries for the accounting treatment of Workmen Compensation Reserve.

The solution of Question 16 Chapter 4 of +2-A

 

In the Books of _______________
Date Particulars
L.F. Debit Credit
2019          
April 1 Workmen Compensation Reserve A/c Dr   1,20,000  
  Revaluation A/c Dr   30,000  
  To Provision for W.C. Claim A/c       1,50,000
  (Being Adjustment for Workmen Compensation Reserve.)        
  X’s Capital A/c Dr   15,000  
  Y’s Capital A/c Dr   9,000  
  Z’s Capital A/c Dr   6,000  
  To Revaluation A/c       30,000
  (Being Adjustment for Workmen Compensation Reserve.)      
           

 

Working Note :

 

Calculation of Balance available for partners of Workmen Compensation Reserve

Balance of W. C. R. = 1,50,000 – 1,200,000
  = 30,000
Amount to be Credited to X’s Capital = 30,000 X 5
10
  = 15,000    

 

Amount to be Credited to Y’s Capital = 30,000 X 3
10
  = 9,000    

 

Amount to be Credited to Z’s Capital = 30,000 X 2
10
  = 6,000    

 

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)

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

 

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2 Book 1 min - Question 16 Chapter 4 of +2-A - T.S. Grewal 12 Class Part - A Vol. 1
Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

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