Question 25 Chapter 6 - Unimax Class 12 Part 1

Question 25 Chapter 6 – Unimax Class 12 Part 1 – 2021

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The solution of Question 25 Chapter 6 – Unimax Class 12 Part 1: –

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

25. The balance sheet of J, K and L, who were sharing profits in the ratio of 5 : 3 : 2 is given below :

Liabilities	Amount	Assets	Amount
Sundry Creditors	78,600	Land	1,85,000
Capital		Buildings	2,87,000
J	5,78,800	Plant and Machinery	3,86,000
K	3,47,800	Stock	1,85,000
L	2,37,900	Debtors	92,100
		Cash	1,08,000

	12,43,100		12,43,100

L retires on the above date and the following adjustments in the value of assets and liabilities were agreed upon :

Land was undervalued by Rs. 120000; Plant and Machinery overvalued by Rs. 35000.
Provision for doubtful debts was required for Rs. 6000.
Goodwill was valued at Rs. 300000 and was to be adjusted against capitals of remaining partners.

L was paid Rs. 75000 immediately and the balance amount was to be transferred to his loan account.
Prepare necessary Revaluation a/c, Capital a/c and Balance Sheet of reconstitution firm as on above date.

The solution of Question 25 Chapter 6 – Unimax Class 12 Part 1: –

Revaluation A/c

Particulars		Rs.	Particulars	Rs.
To Plant and Machinery		35,000	By Land	1,20,000
To Profit on revaluation
J	39,500
K	23,700
L	15,800	79,000
To Provision for doubtful debts		6,000

		1,20,000		1,20,000

Capital Accounts

Particulars	J	K	L	Particulars	J	K	L
To L’s Capital a/c	37,500	22,500		By Balance b/d	5,78,800	3,47,800	2,37,900
To Cash			75,000	By J’s Capital a/c		`	37,500
To L’s Loan			2,38,700	By K’s Capital a/c			22,500
To Balance c/d	5,80,800	3,49,000		By Revaluation a/c (Profit)	39,500	23,700	15,800

	6,18,300	3,71,500	3,13,,700		6,18,300	3,71,500	3,13,700

Balance Sheet (After Retirement)

Liabilities	Rs.	Assets	Rs.
Sundry Creditors	78,600	Land	3,05,000
Capital Accounts		Building	2,87,000
A	5,80,800	Plant and Machinery	3,51,000
B	3,49,000	Stock	1,85,000
L’s Loan a/c	2,38,700	Debtors	86,100
		Cash	33,000

	12,47,100		12,47,100