Question 50 Chapter 7 of +2-A - T.S. Grewal 12 Class Part

Question 50 Chapter 7 of +2-A

Table of Contents

The solution of Question 50 Chapter 7 of +2-A: –

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

50. P, Q and R are three partners sharing profits and losses in the ratio of 3 : 3 : 2 respectively . Their respective capitals are in their profit-sharing proportions . On 1st April, 2017 , the total capital of the firm and the balance of General Reserve are 80,000 and 20,000 respectively. During the year 2017-18 the firm made a profit of 28,000 before charging interest on capital @ 5%. The drawings of the partners are P— 8,000; Q— 7,000; and R— 5,000. On 31st March, 2018 their liabilities were 18,000. On this date , they decided to dissolve the firm. The assets realised 1,08,600 and realisation expenses amounted to 1,800. Prepare necessary Ledger Accounts to close the books of the firm.

The solution of Question 50 Chapter 7 of +2-A: –

Revaluation Account
Particular 5		Amount	Particular		Amount
Revaluation Account		1,26,000	Creditors		18,000
X’s Capital A/c Creditors		14,000	Cash A/c Assets Realized		1,08,600
Cash A/c
Creditors	18,000
Expenses	1,800	19,800

			Loss transferred to:
			P’s Capital A/c	7,200
			Q’s Capital A/c	7,200
			R’s Capital A/c	4,800	19,200
		1,14,800			1,14,800

Partners’ Capital Account
Part.	P	Q	R	Part.	P	Q	R
To Drawing A/c	8,000	7,000	5,000	By Balance B/d	30,000	30,000	20,000
To Realization Loss A/c	7,200	7,200	4,800	By Interest on Capital A/c	1,500	1,500	1,000
				By P/L Appropriation A/c (WN 3)	9,000	9,000	9,000

To Cash A/c	32,800	32,800	22,200
	48,000	48,000	32,000		48,000	48,000	32,000

Cash Account
Particular		Amount	Particular	Amount
Capital A/cs			Sundry Assets (Balancing figure)	1,26,000
P’s Capital A/c	22,000
Q’s Capital A/c	23,000
R’s Capital A/c	15,000	60,000
General Reserve		20,000
Profit and Loss A/c		28,000
Creditors		18,000

		1,26,000		1,26,000

Working Note:

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Computation of Partners’ Capital after drawings as on 31st March 2018
Part.	P	Q	R	Part.	P	Q	R
To Drawing A/c	8,000	7,000	5,000	By Balance B/d	30,000	30,000	20,000



To Cash A/c	22,000	23,000	15,000
	30,000	30,000	20,000		30,000	30,000	20,000

Profit and Loss Appropriation Account Dr. for the year ending 31st March, 2018
Particular		Amount	Particular	Amount
Interest on Capital			Profit and Loss A/c	28,000
P’s Capital A/c	1,500
Q’s Capital A/c	1,500
R’s Capital A/c	1,000	4,000
Profit transferred to:
P’s Capital A/c	9,000
Q’s Capital A/c	9,000
R’s Capital A/c	6,000	24,000
		28,000		28,000

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)

Chapter No. 8 – Company Accounts – Accounting for Share Capital
Chapter No. 9 – Company Accounts – Issue of Debentures
Chapter No. 10 – Redemption of Debentures

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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