Question 43 Chapter 6 - Unimax Class 12 Part 1 - 2021

Question 43 Chapter 6 – Unimax Class 12 Part 1 – 2021

Table of Contents

43. Following is the balance sheet of Tony, Sony and Romy as on 31st March 2021.

Sony died on 30th June 2021. Under the terms of the partnership deed, the executors of a deceased partner were entitled to:

Amount standing to the credit of the partner’s capital account.
Interest on capital at 5%per annum.
Share of Goodwill on the basis of twice the average of the past three year’s profit.
Share of profit from the closing of the last financial year to the date of death on the basis of the last three year’s profit. Profits for 2019, 2020 and 2021 were ₹12000, ₹ 16000, ₹ 14000 respectively. Profits were shared in the ratio of capitals.

Record the necessary Journal entries and draw up the Sony’s account to be rendered to his executors.

The solution of Question 43 Chapter 6 – Unimax Class 12 Part 1: –

Journal Entry

Date	Particulars		L.F.	Debit	Credit

	Profit and loss suspense a/c	Dr.		1,000
	To Sony’s capital a/c				1,000
	(Being share of profit for 3 months paid.)

	Profit and loss suspense a/c	Dr.		250
	To interest on capital a/c				250
	(Being interest on capital transferred to P /L suspense a/c.)

	Interest on capital a/c	Dr.		250
	To Sony’s capital a/c				250
	(Being int. On capital transferred to deceased partner’s capital a/c)

	General reserves a/c	Dr.		14,000
	To Tony’s capital a/c				6,000
	To Sony’s capital a/c				4,000
	To Romy’s capital a/c				4,000
	(Being accumulated profit distributed among partners)

	Tony’s capital a/c	Dr.		4,800
	Romy’s capital a/c	Dr.		3,200
	To Sony’s capital a/c				8,000
	(Being deceased partner paid on account of Goodwill by continuing partners)

	Sony’s capital a/c	Dr.		33,250
	To sony’s executor’s loan a/c				33,250
	(Being balance of Sony’s capital transferred to his executors loan a/c)

Sony’s capital A/c