Advertisement

Question 61 Chapter 5 of +2 Part-1 – USHA Publication 12 Class Part – 1

Question 61 Chapter 5 of +2- Part-
Q-61. - CH-2 - Usha +2 Book 2018 - Solution

Advertisement

Question 61 Chapter 5 of +2-Part-1

Advertisement

61. ( Capital to be adjusted on the basis of New Partner’s Share) A & B are partners in the firm sharing profit & losses in the ratio 3: 2. their balance sheet on 1st, January 2018 was as follows :

Liabilities  Rs.Assets Rs.
Sundry Creditors  15,000Pant 30,000
Capital A/c  Patents 10,000
A30,000 Stock 20,000
B25,000 Debtors  18,000
  55,000Cash 2,000
General reserve 10,000  
  80,000 80,000

C is admitted as a partner on the above date on the following terms: (1) He will pay Rs. 10,000 as goodwill for one-fourth share in the profits of the firm.
(ii) The assets are to be valued as under. Plant at Rs. 32,000; Stock at Rs. 18,000; Debtors at book figure less a provision of 5per cent for doubtful debts.
(iii) It was found that creditors included a sum of Rs. 1,400 which was not to be paid. But it was also found that there was a liability for compensation to workers amounting to Rs. 2,000.
(iv) C was to introduce 20,000 as capital and the capitals of the other partners were to be adjusted in the new profit-sharing ratio. For this purpose, current accounts were to be opened. Give journal entries to record the above and the balance sheet after C’s admission (ledger accounts are not required).

We are providing a solution of Question 61 Chapter 5 of +2 Part-1 in two formats. one is in Video format and another is in article format. Check out both formats as follows:

1. Check out the Solution of this question in Video Format:-

The video consists solution of question numbers from 61 to 62 Chapter no. 5 class 12 of Usha publication. To check the direct solution of question no. 61 from the following video by using time stamps of the video.

2. Check out the Solution of this question in Article Format:-

The solution of Question 61 Chapter 5 of +2 Part-1: –

Journal
DateParticulars
L.F.DebitCredit
      
 Bank A/cDr. 30,000 
 To C’s capital A/c   20,000
  To Premium A/c   10,000
 (Being amount brought in by C as his capital and share of goodwill)   
     
 Premium A/cDr. 10,000 
 To A’s Capital A/c   6,000
 To B’s Capital A/c   4,000
 (Being amount of goodwill transferred to the capital amount of old partners in the ratio of their sacrifice i.e., 3:2)   
      
 Revaluation A/cDr. 4,900 
 To workmen’s compensation fund  2,000
 To Stock   900
 To provisional for doubtful debts A/c)  2,000
 (Being decrease in the value of various assets on C’s admission)   
      
 Plant A/cDr. 2,000 
 Sundry creditorsDr. 1,400 
 To Revaluation A/c   3,400
 (Being the increase in the value of the plant & decrease in the value of liabilities on C’s admission )   
      
 A’s Capital A/cDr. 900 
 B’s Capital A/cDr. 600 
 To Revaluation A/c   1,500
 (Being the profit on revaluation transferred to capital A/c of the old partners in the old sharing ratio )   
      
 General reserveDr. 10,000 
 To A’s capital A/c   6,000
 To B’s Capital A/c   4,000
 (Being profit on revaluation distributed )   
      
 A’s capital A/cDr. 5,100 
 To A’s current A/c   5,100
 (Being General reserve distributed)   
      
 B’s capital A/cDr. 8,400 
 To B’s current A/c   8,400
 (Being excess of the capital A/c transferred to the current A/c   
     
Balance Sheet
Liabilities
AmountAssetsAmount
Sundry Creditors 13,600  32,000
Workmen’s compensation fund2,000Debtors18,000 
Current A/c s  (-) Prov. For D/D90017,100
A5,100 Stock 18,000
B8,40013,500Patents 10,000
Capital A/c  Plants 32,000
A36,000    
B24,000    
C20,00080,000   
  1,09,100  1,09,100

Advertisement-X

Working Note:

Calculation of New Profit Sharing Ratio:

Remaining Share for Old partners = Total Profit – Share of New Partner 

= 1 – 1/4

=4-1/4

=3/4

Advertisement-X

Now, Distribute the remaining share among old Partners :

New Share of Partner = Remaining Share X Old Share of Partner

New Share of A = 3/4 X 3/5

= 9/20

New Share of B = 3/4 X 2/5

= 6/20

Advertisement-X

Now make the same denominator of All partners

So, C’s New Ratio = 1/4 X 5/5 

= 5/20

New Profit Sharing Ratio = 9:6:5 

Now, Calculate the Closing balance of A and B capital according to the new profit-sharing ratio

So, Firstly Calculate:

Advertisement-X

Total Capital of Firm = Amount invested by the New Partner X Reciprocal of Share of New Partner

= 20,000 X 4/1 

= 80,000/-

Now Calculate: 

A’s New Capital Balance =  Total Capital of Firm X A’s New Share

= 80,000 X 9/20

Advertisement-X

Advertisement-Y

= 36,000/-

B’s New Capital Balance =  Total Capital of Firm X B’s New Share

= 80,000 X 6/20

= 24,000/-

Now according to the question, we have to adjust the capital balance with the current account. 

Partner’s Capital A/c
ParticularsABCParticularsABC
To P/L App. (Loss)900600By Bal. B/d30,00025,000
    By Bank a/c20,000
    By Goodwill6,0004,000
    By General Res.6,0004,000
To Current A/c (B.Fig)5,1,008,400    
To Bal. c/d36,00024,00020,000    
 42,00033,00020,000 42,00033,00020,000

 

Advertisement-X

Comment if you have any questions.

Also, Check out the solved question of previous Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

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 Firm

Advertisement

Advertisement

error: Content is protected !!