Question 82 Chapter 2 of +2-A
82. Vikas and Vivek were partners in a firm sharing profits in the ratio of 3: 2. On 1st April 2018, they admitted Vandana as a new partner for 1/8th share in the profits with a guaranteed profit of 1,50,000. The new profit-sharing ratio between Vikas and Vivek will remain the same but they decided to bear any deficiency on account of guarantee to Vandana in the ratio 3 : 2. Profit of the firm for the year ended 31st March 2019 was 9,00,000. Prepare Profit and Loss Appropriation Account of Vikas, Vivek and Vandana for the year ended 31st March 2019.
The solution of Question 82 Chapter 2 of +2-A:
| Balance Sheet (for the year ended 31st March 2019) |
|||||
| Liabilities |
Amount | Assets |
Amount | ||
| By Profit and Loss A/c | 9,00,000 | ||||
| To Profit Transferred to *2 | |||||
| Vikas’s Capital A/c | 4,50,000 | ||||
| Vivek’s Capital A/c | 3,00,000 | ||||
| Vandana’s Capital A/c | 1,50,000 | 9,00,000 | |||
| 9,00,000 | 9,00,000 | ||||
Working Note: –
*1Calculation of distribution of Profits for the year 2018-19 the among the partners
Profit for 2019= 9,00,000
Vandana’s Profit share= 1/8th of a firm’s profit
| Vandana’s Share of Profit | = | 9,00,000 | X | 1 |
| 8 |
Vandana’s Share of Profit = 1,12,500
Remaining Profit for remaining partner = 9,00,000 -1,12,500 = Rs 7,87,500
| Vikas’s Share of Profit | = | 7,87,500 | X | 3 |
| 5 |
Vikas’s Share of Profit = 4,72,500
| Vivek’s Share of Profit | = | 7,87,500 | X | 2 |
| 5 |
Vivek’s Share of Profit = 3,15,000
Vandana’s is given a guarantee of a minimum profit of Rs 1,50,000.
Vandana’s Actual Profit Share i. e. Rs 1,12,500 is less than his Minimum Guaranteed Profit i.e. Rs 1,50,000
Deficiency in Vandana’s Profit Share = 1,50,000 − 1,12,500 = Rs 37,500
This deficiency of Rs 37,500 is to be borne by A and B in the ratio 3 : 2.
| Vikas’s Share of Profit | = | 37,500 | X | 3 |
| 5 |
Vikas’s Share of Profit= 22,500
| Vivek’s Share of Profit | = | 37,500 | X | 2 |
| 5 |
Vivek’s Share of Profit= 15,000
Now, Final distributed among the partners
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| Vikas’s Share of Profit | = | 4,72,500 | – | 22,500 | =4,50,000 |
| Vivek’s Share of Profit | = | 3,15,000 | – | 15,000 | =3,00,000 |
| Vandana’s Share of Profit | = | 1,12,500 | + | 37,500 | =1,50,000 |
Also, Check out the solved question of previous Chapters: –
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
Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication
