Question 68 Chapter 5 of Class 12 Part – 1 Usha Publication
68. (Adjustment of the capital/goodwill/revaluation A/c/ partner’s capital A/c balance sheet) The following is the balance sheet as on 31st March , 2015 of A & B, who shares profit & losses in ratio 3:2
| Liabilities | Rs. | Assets | Rs. |
| Capital A/c | Plant & Machinery | 10,000 | |
| A | 10,000 | Land & Buildings | 8,000 |
| B | 10,000 | Debtors 12,000 | |
| General reserve | 15,000 | Less: provision 5,100 | 11,000 |
| Workmen’s compensation fund | 5,000 | Stock | 12,000 |
| Creditors | 10,000 | Cash | 9,000 |
| 50,000 | 50,000 |
They agreed to admit C into partnership on the following terms:
(i) Provision for doubtful debts would be increased by Rs. 2,000.
(ii) The value of land and building would be increased to Rs. 18,000.
(iii) The value of the stock would be increased by Rs. 4,000.
(iv) The liability against Workmen’s Compensation Fund is determined at Rs. 2,000.
(v) C brought in as his share of goodwill Rs.10,000 in cash.
(vi) C would bring further cash as would make his capital equal to 20% of the total capital of the new firm after the above revaluation and adjustments are carried out.
Prepare Revaluation Account, Partners’ Capital Accounts and Balance Sheet of the firm after C’s admission.
The solution of Question 68 Chapter 5 of Class 12 Part – 1 Usha Publication: –
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| Revaluation account |
|||||
| Particulars |
Amount | Particulars | Amount | ||
| To Provision for doubtful debts | 2,000 | By land & buildings | 10,000 | ||
| By Stock | 4,000 | ||||
| To Profit on revaluation transferred to capital A/c |
|||||
| A | 7,200 | ||||
| B | 4,800 | 12,000 | |||
| 14,000 | 14,000 | ||||
| Partners’ Capital Account | |||||||
| Particulars | A | B | C | Particulars | A | B | C |
| To A’s capital A/c | 6,000 | By Balance b/d | 10,000 | 10,000 | |||
| To B’s Capital A/c | 4,000 | By General Res. A/c | 9,000 | 6,000 | |||
| By revaluation A/c | 7,200 | 4,800 | |||||
| By premium A/c | 6,000 | 4,000 | |||||
| By workmen’s C.F. | 1,800 | 1,200 | |||||
| By Cash A/c | 25,000 | ||||||
| To Balance c/d | 34,000 | 26,000 | 15,000 | ||||
| 34,000 | 26,000 | 25,000 | 34,000 | 26,000 | 25,000 | ||
| Balance Sheet |
|||||
| Liabilities |
Amount | Assets | Amount | ||
| Workmen’s compensation Claim Payable A/c | 2,000 | Cash | 34,000 | ||
| Creditors | 10,000 | Plant & Machinery | 10,000 | ||
| Capital Accounts | Land & building | 18,000 | |||
| A | 34,000 | Debtors | 12,000 | ||
| B | 26,000 | Less provision For debts | 3,000 | 10,000 | |
| C | 15,000 | 75,000 | Stock | 16,000 | |
| 87,000 | 87,000 | ||||
WORKING NOTES :
Calculation of proportionate capital of C
Let total Share of the firm = 1
| Share of profit given to C | = | 1 |
| 5 |
| Combined share of A and B | = | 1 | – | 1 |
| 5 | ||||
| = | 4 | |||
| 5 |
Combined capitals of A and B after making allotments (34000+26000) = Rs 60,000
| C’s Share | = | Rs. 60,000 | x | 5 | X | 1 |
| 4 | 5 | |||||
| = | Rs 15,000 |
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Chapter-Wise Solution of Usha Publication Accountancy – Part 1 Class 12 – Session 2024-25 as per the PSEB curriculum
Check out Solutions to all questions of the every chapter shown as under. The Solution of Accountancy – Part 1 Class 12 – Session 2024-25 is provided as per the new book published by Usha Publication.
Chapter No. 1 – Accounting Not-for-Profit Organisations (Deleted from the Syllabus)
Chapter No. 2 – Partnership Accounts – I (Introduction)
Chapter No. 3 – Partnership Accounts – II (Goodwill: Nature and Valuation)
Chapter No. 4 – Partnership Accounts – III (Reconstitution of Partnership)
Chapter No. 5 – Partnership Accounts – IV (Admission of A Partner)
Chapter No. 6 – Partnership Accounts – V (Retirement and Death of A Partner)
Chapter No. 7 – Partnership Accounts – VI (Dissolution of Partnership Firm)
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- Chapter No. 1 – Accounts of Non-Profit Organisations (Deleted from the Syllabus)
- Chapter No. 2 – Partnership Accounts – I (Basic Concepts)
- Chapter No. 3 – Partnership Accounts – II (Goodwill)
- Chapter No. 4 – Partnership Accounts – III (Change in Profit Sharing Ratio among Existing Partners)
- Chapter No. 5 – Partnership Accounts – IV (Admission of A Partner)
- Chapter No. 6 – Partnership Accounts – V (Retirement and Death of A Partner)
- Chapter No. 7 – Partnership Accounts – VI (Dissolution of Partnership Firm)
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i think the calculation of capital is wrong…in the question it is given that adjusted capital would be equal to 20%.
no its correct.
20% means 200/100 = 1/5
so the calculation of total capital =
Adjusted Capital X reverse of remaining share of old parnters X New partner Share
60000 X 5/4 X 1/5
= 15,000/- Ans.