Question 49 Chapter 5 of +2-Part-1
49. (Revaluation A/c/Partner‘s Cap A/c/B/S) Vimal and Nirmal are partners in firm sharing profits and losses in the ratio of 3 2. On 31st March, 2019 the position of business was as at follows :-
| Liabilities | Rs | Assets | Rs |
| Sundry Creditors | 20,000 | Cash | 14,000 |
| Capital A/c s | Debtors | 18,000 | |
| Vimal | 60,000 | Plant & Machinery | 50,000 |
| Nirmal | 32,000 | Stock | 40,000 |
| Profit and losses A/c | 10,000 | ||
| 1,22,000 | 1,22,000 |
On this day, Kailash agrees to join the business on the following terms and conditions:
(i) He will introduce Rs. 40,000 as his capital and pay Rs. 20,000 to the existing partners for his share of goodwill.
(ii) The new profit sharing ratio is 2:1:1 respectively for Vimal, Nirmal and Kailash.
(iii) A revaluation of assets will be made by reducing plant and machinery to Rs. 35,000 and bad and doubtful debts. Stock by 10%. Provision of Rs. 1,000 to be created for bad and doubtful debts
(iv) Goodwill account is not to be raised.
Pass journal entries for the above arrangement and give the balance sheet of the newly Constituted firm. Also specify the sacrifice ratio.
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The solution of Question 49 Chapter 5 of +2 Part-1: –
| Journal | |||||
| Date | Particulars |
L.F. | Debit | Credit | |
| Revaluation A/c | Dr. | 20,000 | |||
| To Plant & Machinery A/c | . | 15,000 | |||
| To Stock A/c | 4,000 | ||||
| To Provisional for doubtful debts A/c) | 1,000 | ||||
| (Being the decrease in the value of various assets on Kailash’s Admission ) | |||||
| Vimal’s Capital A/c | Dr. | 12,000 | |||
| Nirmal’s Capital A/c | Dr. | 8,000 | |||
| To Revaluation A/c | 20,000 | ||||
| (Being loss on revaluation transferred to Capital’s of old partners in old ratio) | |||||
| Cash A/c | Dr. | 60,000 | |||
| To Kailash’s Capital A/c | 40,000 | ||||
| To Premium for Goodwill A/c | 20,000 | ||||
| (Being capital & goodwill brought by kailash) | |||||
| Premium for Goodwill A/c | Dr. | 20,000 | |||
| To Vimal’s Capital A/c | 8,000 | ||||
| To Nirmal’s Capital A/c | 12,000 | ||||
| (Being amount of goodwill brought in by Kailash shared by old partners in sacrificing ratio) | |||||
| Cash Account |
|||||
| Particulars |
Amount | Particulars | Amount | ||
| To Balance b/d | 14,000 | By Balance b/d | 74,000 | ||
| To Kailash’s Capital A/C | 40,000 | ||||
| To Goodwill A/c | 20,000 | ||||
| 74,000 | 74,000 | ||||
| Vimal’s capital Account |
|||||
| Particulars |
Amount | Particulars | Amount | ||
| To Revaluation Account | 12,000 | By Balance b/d | 60,000 | ||
| To Balance c/d | 62,000 | By Profit & loss Account | 6,000 | ||
| By Premium for Goodwill A/c | 8,000 | ||||
| 74,000 | 74,000 | ||||
| Nirmal capital Account |
|||||
| Particulars |
Amount | Particulars | Amount | ||
| To Revaluation Account | 8,000 | By Balance b/d | 32,000 | ||
| To Balance c/d | 40,000 | By Profit & loss Account | 4,000 | ||
| By Premium Account | 12,000 | ||||
| 48,000 | 48,000 | ||||
| Kailash’s capital Account |
|||||
| Particulars |
Amount | Particulars | Amount | ||
| To Balance c/d | 40,000 | By Cash A/c | 40,000 | ||
| 40,000 | 40,000 | ||||
| Balance Sheet |
|||||
| Liabilities |
Amount | Assets | Amount | ||
| Sundry Creditors | 20,000 | Cash | 74,000 | ||
| Capital A/c s | 12,000 | Debtors | 18,000 | ||
| Vimal | 62,000 | Less: provision For D/D |
1,000 | 17,000 | |
| Nirmal | 40,000 | Stock (40000-4000) | 36,000 | ||
| Kailash | 40,000 | 1,42,000 | Plant & Machinery (50000 -15000) |
35,000 | |
| 1,62,000 | 1,62,000 | ||||
Working Notes:
Calculation of sacrifice Ratio :
| Vimal’s Sacrifice Share | = | 3 | – | 2 |
| 5 | 4 | |||
| = | 2 | |||
| 20 |
| Nirmal’s sacrifice Share | = | 2 | – | 1 |
| 5 | 4 | |||
| = | 3 | |||
| 20 |
Sacrifice made by Vimal & Nirmal at the admission of Kailash is in the ratio of 2 : 3
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The solution to all questions of Chapter No. 5 – Partnership Accounts – IV (Admission of A Partner) Class 12 Usha Publication – 2024 is shown as follows, click on the image of the question to get the solution.
Question 18 Chapter 5 of +2 Part-1 – USHA Publication 12 Class Part – 1
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Question 47 Chapter 5 of +2 Part-1 – USHA Publication 12 Class Part – 1
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Chapter-Wise Solution of Usha Publication Accountancy – Part 1 Class 12 – Session 2024-25 as per the PSEB curriculum
Check out Solutions to all questions of the every chapter shown as under. The Solution of Accountancy – Part 1 Class 12 – Session 2024-25 is provided as per the new book published by Usha Publication.
Chapter No. 1 – Accounting Not-for-Profit Organisations (Deleted from the Syllabus)
Chapter No. 2 – Partnership Accounts – I (Introduction)
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Chapter No. 3 – Partnership Accounts – II (Goodwill: Nature and Valuation)
Chapter No. 4 – Partnership Accounts – III (Reconstitution of Partnership)
Chapter No. 5 – Partnership Accounts – IV (Admission of A Partner)
Chapter No. 6 – Partnership Accounts – V (Retirement and Death of A Partner)
Chapter No. 7 – Partnership Accounts – VI (Dissolution of Partnership Firm)
Also, Check out our Comprehensive Chapter-wise solution of Advanced Accountancy Part 1 Class 12 by Unimax Publication
- Chapter No. 1 – Accounts of Non-Profit Organisations (Deleted from the Syllabus)
- Chapter No. 2 – Partnership Accounts – I (Basic Concepts)
- Chapter No. 3 – Partnership Accounts – II (Goodwill)
- Chapter No. 4 – Partnership Accounts – III (Change in Profit Sharing Ratio among Existing Partners)
- Chapter No. 5 – Partnership Accounts – IV (Admission of A Partner)
- Chapter No. 6 – Partnership Accounts – V (Retirement and Death of A Partner)
- Chapter No. 7 – Partnership Accounts – VI (Dissolution of Partnership Firm)
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