A and B were partners sharing profit and losses in the proportion of 2/3 and 1/3. Their
Balance Sheet is as follows:
Balance Sheet as on 31st March, 2009
Amount Amount
Liabilities (`) Assets (`)
Capitals: Building 62,000
A 46,000 Stock 30,000
B 34,000 Debtors 21,500
General Reserve 9,000 Less: R.D.D. (1,500) 20,000
Profit and Loss A/c 3,000 Furniture 20,000
Sundry Creditors 43,000 Office Equipments 6,000
A’s loan A/c 11,000 Cash 8,000
1,46,000 1,46,000
On 1st April 2009, D is admitted in the partnership on the following terms:
a. D should bring in cash ` 15,000 and stock worth ` 5,000 as capital for 20 paise share
in future profits.
b. Half of A's loan repaid with interest ` 200.
c. Goodwill of firm valued at ` 9,000 and it is decided to write off the goodwill.
d. Building is revalued at ` 50,000 and the value of stock be reduced by ` 5,000.
e. Reserve for doubtful debts to be maintained at ` 1,000 only.
f. Capital account balances of all the partners to be adjusted in their new profit sharing
ratio by making adjustments through Partner's Current A/c.
Prepare Profit and Loss Adjustment A/c, Capital A/cs and Balance Sheet of new firm.
Answers!
Outstanding were wages 2000 what is trading account of
Comment
The Balance Sheet of “Ajay Traders” is as follows. The partners share profits and losses as
P 5/10, Q 2/10 and R 3/10.
Balance Sheet as on 31st March, 2010
Liabilities (`) Assets (`)
Creditors 10,400 Cash at hand 1,400
General reserve 24,000 Goodwill 4,200
Capital A/c’s: Debtors 13,800
P 30,000 Less: R.D.D. (800) 13,000
Q 22,000 Stock 27,400
R 23,600 Plant and Machinery 30,000
Factory Building 34,000
1,10,000 1,10,000
Q retires from the business on 1st April, 2010 on the following terms:
a. The assets are revalued as under:
1. Stock at ` 25,000.
2. Factory Building is appreciated by 15%.
3. Reserve for bad and doubtful debts is to be increased upto ` 1,100.
4. Plant and Machinery depreciated by 5%.
b. The goodwill of the firm is valued at ` 20,000, which is to be written off. The remaining
partners decided new profit sharing ratio which will be 3 : 2.
c. Q be paid ` 840 in cash on his retirement and the balance is to be transferred to his
loan account.
Pass necessary journal entries to give the above effect.
Answer the question...
Outstanding were wages 2000 what is trading account of
Comment
The Balance Sheet of “Ajay Traders” is as follows. The partners share profits and losses as
P 5/10, Q 2/10 and R 3/10.
Balance Sheet as on 31st March, 2010
Liabilities (`) Assets (`)
Creditors 10,400 Cash at hand 1,400
General reserve 24,000 Goodwill 4,200
Capital A/c’s: Debtors 13,800
P 30,000 Less: R.D.D. (800) 13,000
Q 22,000 Stock 27,400
R 23,600 Plant and Machinery 30,000
Factory Building 34,000
1,10,000 1,10,000
Q retires from the business on 1st April, 2010 on the following terms:
a. The assets are revalued as under:
1. Stock at ` 25,000.
2. Factory Building is appreciated by 15%.
3. Reserve for bad and doubtful debts is to be increased upto ` 1,100.
4. Plant and Machinery depreciated by 5%.
b. The goodwill of the firm is valued at ` 20,000, which is to be written off. The remaining
partners decided new profit sharing ratio which will be 3 : 2.
c. Q be paid ` 840 in cash on his retirement and the balance is to be transferred to his
loan account.
Pass necessary journal entries to give the above effect.
P 5/10, Q 2/10 and R 3/10.
Balance Sheet as on 31st March, 2010
Liabilities (`) Assets (`)
Creditors 10,400 Cash at hand 1,400
General reserve 24,000 Goodwill 4,200
Capital A/c’s: Debtors 13,800
P 30,000 Less: R.D.D. (800) 13,000
Q 22,000 Stock 27,400
R 23,600 Plant and Machinery 30,000
Factory Building 34,000
1,10,000 1,10,000
Q retires from the business on 1st April, 2010 on the following terms:
a. The assets are revalued as under:
1. Stock at ` 25,000.
2. Factory Building is appreciated by 15%.
3. Reserve for bad and doubtful debts is to be increased upto ` 1,100.
4. Plant and Machinery depreciated by 5%.
b. The goodwill of the firm is valued at ` 20,000, which is to be written off. The remaining
partners decided new profit sharing ratio which will be 3 : 2.
c. Q be paid ` 840 in cash on his retirement and the balance is to be transferred to his
loan account.
Pass necessary journal entries to give the above effect.