Question 85 Chapter 5 of +2-A - T.S. Grewal 12 Class Part

Question 85 Chapter 5 of +2-A

Table of Contents

The solution of Question 85 Chapter 5 of +2-A: –

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

85. X and Y are partners sharing profits equally. Their Balance Sheet as on 31st March, 2019 is given below:

Liabilities			Assets
Capital A/cs:			Land and Building		1,50,000
X	1,50,000		Plant and Machinery		1,00,000
Y	1,00,000	2,50,000	Furniture and Fittings		25,000
Current A/cs:			Stock		75,000
X	40,000		Debtors	75,000
Y	30,000	70,000	Less: Provision for Doubtful Debts	5,000	70,000
Creditors		1,30,000	Bills Receivable		30,000
Bills Payable		50,000	Bank		50,000
		5,00,000			5,00,000

Z is admitted as a new partner for 1/4th share under the following terms:
(a) Z is to introduce 1,25,000 as capital.
(b) Goodwill of the firm was valued at nil.
(c) It is found that the creditors included a sum of 7,500 which was not to be paid. But it was also found that there was a liability for Compensation to Workmen amounting to 10,000.
(d) Provision for doubtful debts is to be created @ 10% on debtors.
(e) In regard to the Partners’ Capital Accounts, present Fixed Capital Account Method is to be converted into Fluctuating Capital Account Method. (f) Bills of 20,000 accepted from creditors were not recorded in the books. (g) X provides 50,000 loan to the business carrying interest @ 10% p.a. You are required to prepare Revaluation Account,
Partners’ Capital Accounts, Bank Account and the Balance Sheet of the new firm

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The solution of Question 85 Chapter 5 of +2-A: –

Revaluation Account
Particular	Amount	Particular		Amount
Reserve for D. Debts	2,500	Creditors		7,500
Outstanding Rent	10,000

		Loss transferred to
		X’s Current A/c	2,500
		Y’s Current A/c	2,500	5,000
	12,500			12,500

Partners’ Current Account
Parti culars	X	Y	Z	Partic ulars	X	Y	Z
To Revaluation A/c	2,500	2,500	–	By Balance B/d	40,000	30,000	–
					–	–	–
To Balance c/d	37,500	27,500	–
	40,000	30,000	–		40,000	30,000	–

Partners’ Capital Account
Parti culars	X	Y	Z	Partic ulars	X	Y	Z
			–	By Balance B/d	1,50,000	1,00,000	–
			–	By Bank A/c A/c	–	–	1,25,000
			–	By Current A/c	37,500	27,500	–
			–
To Balance c/d	1,87,500	1,27,500	1,25,000				–
	1,87,500	1,27,500	1,25,000		1,87,500	1,27,500	1,25,000

Balance Sheet
Liabilities		Amount	Assets		Amount
Creditors	(1,30,000 – 7,500 – 20,000	1,02,500	Land and Building		1,50,000
Bills Payable	(50,000 + 20,000)	70,000	Plant and Machinery		1,00,000
Capital A/cs:			Fixture and Fittings		25,000
X	1,87,500		Debtors	75,000
Y	1,27,500		Less: 5% Reserve for D. Debts	7,500	67,500
Z	1,25,000	4,40,000	Bank	(50,000 + 1,25,000 + 50,000)	2,25,000
X’s Loan		50,000	Stock		75,000
Liability for WCF		10,000	Bills Receivables		30,000

		6,72,500			6,72,500

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

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