Question 54 Chapter 6 of +2-A – T.S. Grewal 12 Class Part – A Vol. 1

Question 54 Chapter 6 of +2-A

Question 54 Chapter 6 of +2-A

54. A B and C are partners sharing profits in the ratio of 5 : 3: 2. Their Balance Sheet as on 31st March 2018 is given below:

Liabilities   Amount Assets Amount
Capital A/cs:     Building 18,00,000
A 11,00,000   Investments 4,00,000
B 11,40,000   Stock 6,00,000
C 7,60,000 30,00,000 Debtors 10,00,000
Workmen Compensation Reserve   10,00,000 Cash and Bank 6,00,000
Creditors   2,00,000    
Employees’ Provident Fund   2,00,000    
    44,00,000   44,00,000

C retires on 30th June, 2018 and it was mutually agreed that:
a Building be valued at 22,00,000.
b Investments to be valued at 3,00,000.
c Stock be taken at 8,00,000.
d Goodwill of the firm be valued at two years’ purchase of the average profit of the past five years.
e C’s share of profits up to the date of retirement be calculated on the basis of average profit of the preceding three years.
The profits of the preceding five years were as under:

Year 2013-14 2014-15 2015-16 2016-17 2017-18
Profits 4,00,000 5,00,000 6,00,000 8,00,000 7,00,000

f Amount payable to C to be transferred to his Loan Account carrying interest @ 10% p.a. Prepare Revaluation Account, Partners’ Capital Accounts and the Balance Sheet as at 30th June, 2018.

 

 

The solution of Question 54 Chapter 6 of +2-A: –

 

Revaluation Account
Particular
Amount Particular Amount
To Investments 1,00,000 By Building 4,00,000
    Stock 2,00,000
Profit transferred to:        
A’s Capital A/c 2,50,000        
B’s Capital A/c 1,50,000        
C’s Capital A/c 1,00,000 5,00,000      
    6,00,000     6,00,000

 

Partners’ Capital Account
Part. X Y Z

Part.

X Y Z
To C’s Capital A/c 1,50,000 90,000 By Balance B/d 11,00,000 11,40,000 7,60,000
To C’s Loan A/c 13,35,000 By Re
valua
tion A/c
2,50,000 1,50,000 1,00,000
        By A’s Capital A/c 1,50,000
        By B’s Capital A/c 90,000
        By Work
men Com
pensa
tion Reserve A/c*
5,00,000

3,00,000

2,00,000
        By P & L Sus
pense A/c
35,000
To Balance c/d 17,00,000 15,00,000        
  18,50,000 15,90,000 13,35,000   18,50,000 15,90,000 13,35,000

 

Balance Sheet
Liabilities
Amount Assets Amount
Creditors 2,00,000 Building   22,00,000
Employees’ Provident Fund 2,00,000 Investments   3,00,000
C’s Loan A/c   13,35,000 Stock   8,00,000
Capital:     Debtors   10,00,000
A 17,00,000   Cash and Bank   6,00,000
B 15,00,000 32,00,000 P&L Suspense Account 35,000
    49,35,000     49,35,000

 

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)

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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2 Book 1 min - Question 54 Chapter 6 of +2-A - T.S. Grewal 12 Class Part - A Vol. 1
Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

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