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Question 51 Chapter 7 of +2-A – T.S. Grewal 12 Class Part – A Vol. 1

Question 51 Chapter 7 of +2-A
Question No.51 Chapter No.7 - T.S. Grewal +2 Book 2019-Solution

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Question 51 Chapter 7 of +2-A

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51. X, Y and Z entered into partnership on 1st April, 2016. They contributed capital 40,000, 30,000 and 20,000 respectively and agreed to share profits in the ratio of 3 : 2 : 1. Interest on capital was to be allowed @ 15% p.a. and interest on drawings was to be charged at an average rate of 5%. During the two years ended 31st March, 2018, the firm made profit of 21,600 and 25,140 respectively before allowing or charging interest on capital and drawings. The drawings of each partner were 6,000 per year. On 31st March, 2018, the partners decided to dissolve the partnership due to difference of opinion. On that date, the creditors amounted to 20,000. The assets, other than cash 2,000, realised 1,21,000. Expenses of dissolution amounted to 760. Draw up necessary Ledger Accounts to close the books of the firm.

 

 

The solution of Question 51 Chapter  7 of +2-A: –

 

Profit and Loss Appropriation for
the year ended March 31, 2017

Particular 5
AmountParticular Amount
Interest on Capital A/c: Profit and Loss A/c 21,600
X (40,000 × 15%)6,000 Interest on Drawings  
Y (30,000 × 15%)4,500 X (6,000 × 5%)300 
Z (20,000 × 15%)3,00013,500Y (6,000 × 5%)300 
   Z (6,000 × 5%)300900
      
Profit transferred to:     
X’s Capital A/c4,500    
Y’s Capital A/c3,000    
Z’s Capital A/c1,5009,000   
  22,500  22,500

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Partners’ Capital Accounts for the year 2016-17
Part.XYZ

Part.

XYZ
To Drawing A/c6,0006,0006,000By Cash A/c40,00030,00020,000
To Interest on Drawings A/c300300300By Interest on Capital A/c6,0004,5003,000
    By P/L Appropriation A/c (WN 3)4,5003,0001,500
        
To Cash A/c44,20031,20018,200    
 50,50037,50024,500 50,50037,50024,500

 

Profit and Loss Appropriation for
the year ended March 31, 2018

Particular 5
AmountParticular Amount
Interest on Capital A/c: Profit and Loss A/c 25,140
X (40,000 × 15%) 6,630 Interest on Drawings  
Y (30,000 × 15%)4,680 X (6,000 × 5%)300 
Z (20,000 × 15%)2,73014,040Y (6,000 × 5%)300 
   Z (6,000 × 5%)300900
      
Profit transferred to:     
X’s Capital A/c6,000    
Y’s Capital A/c4,000    
Z’s Capital A/c2,00012,000   
  26,040  26,040

 

Partners’ Capital Accounts for the year 2017-18
Part.XYZ

Part.

XYZ
To Drawing A/c6,0006,0006,000By Cash A/c40,00030,00020,000
To Interest on Drawings A/c300300300By Interest on Capital A/c6,6304,6802,730
    By P/L Appropriation A/c6,0004,0002,000
To Cash A/c50,53033,58016,630     
 56,83039,88022,930 56,83039,88022,930
    By Balance b/d50,53033,58016,630
    By Realization A/c Profit750500250
To Cash A/c51,28034,08016,880    
 51,28034,08016,880 51,28034,08016,880

 

 

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Revaluation Account
Particular 5
AmountParticular Amount
Sundry Assets1,18,740Creditors 20,000
Cash A/c:  Cash Assets realized 1,21,000
Creditors20,000    
Expenses76020,760   
      
      
Profit transferred to:     
X’s Capital A/c750    
Y’s Capital A/c500    
Z’s Capital A/c2501,500   
  1,41,000  1,41,000

 

Partners’ Capital Accounts
Part.XYZ

Part.

XYZ
    By Cash A/c50,53033,58016,630
    By Realization A/c Profit750500250
        
To Cash A/c51,280 34,08016,880    
 51,280 34,08016,880 51,280 34,08016,880

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Cash Account
Particular
AmountParticular Amount
Balance b/d2,000Realization A/c 20,760
Realization A/c 1,21,000   
   X’s Capital A/c 51,280
   Y’s Capital A/c 34,080
   Z’s Capital A/c 16,880
  1,23,000  1,23,000


Working Note:

 

Memorandum Balance Sheet
Particular
AmountParticular Amount
Capital A/cs: Cash 2,000
X’s Capital A/c50,530 Sundry Assets 1,18,740
Y’s Capital A/c33,580    
Z’s Capital A/c16,6301,00,740   
Creditors 20,000   
  1,20,740  1,20,740

 

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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

 

Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication

+2 Book 1-min
Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

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