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Question 61 Chapter 6 of +2-A – T.S. Grewal 12 Class Part – A Vol. 1

Question No.61 Chapter No.6 - T.S. Grewal +2 Book 2019-Solution

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Question 61 Chapter 6 of +2-A

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61. P, R and S are in partnership sharing profits 4/8, 3/8 and 1/8 respectively. It is provided in the Partnership Deed that on the death of any partner his share of goodwill is to be valued at one-half of the net profit credited to his account during the last four completed years. R died on 1st January 2018. The firm’s profits for the last four years ended 31st December, were as: 2014 − 1,20,000; 2015 − 80,000; 2016 − 40,000; 2017 − 80,000.
a Determine the amount that should be credited to R in respect of his share of Goodwill.
b Pass Journal entry without raising Goodwill Account for its adjustment.

 

The solution of Question 61 Chapter 6 of +2-A: –

 

Profit credited to R’s Capital Account in 4 years = Net profit for the last four years × R’s Share

 =1,20,000 + 80,000 + 80,000 + 4,000X2
12
     
 =3,20,000X3
 8
 =Rs 1,20,000  

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R’s Share of goodwill

 =1,20,000X3
 8
 =Rs 60,000  

 

 

DateParticulars
L.F.DebitCredit
bP’s Capital A/cDr. 48,000 
 S’s Capital A/cDr. 12,000 
 To R’s Capital A/c   60,000
 (Being R’s share of goodwill adjusted)   
      

 

 

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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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