gg Partie! 0 y “EXERCISES-————__Isa Profit Sharing Ratio yf New ye . ” » partners sharing profits in th F 4 qe par fc ratio of 3 2 yan - They admit'z iy ar itt A th share in future profit, Caleutiite new ; weit 5 Ratio /Madras BCA/BSe (2PAR) Nyy 2008 ij [Ans 12:9 )¥ were partners sharing profits in the ratio O73. 7 imitte ‘ 4 » Kad Was adi a i share. € aleulate new profit sharing:ratio of {Madras B.Com (P224) Nay, 2008 end Nex a [Ans: 14: 6: 15) » Qand R are partners sharing profits equally, They admit for Fthshareand that relative ratio between them will remain unch Citas aw profit sharing ratio, ‘aleul |Ans: New ratio: 4:4: 4:3) ( Send B are partners sharing profits & losses in the ratio of 3 - 1. They agree to aim C into partnership who is to get th share He acquires this share as to 3 . from A.and = from B. Caleulate thenew profit sharing ratio, (Madras, B.Com(PZ2A) Nov. 2007; B.Com, Sept. 1987) [Ans : New ratio: 23; 5:4] t Nand Y ate sharing profits and losses in the ratio of 7 3. They admit Z for Tih share in the new firm which he takes 44 from X and Vy from ¥. Calculate the new profit sharing ratio of parmers. {Madras, BBA(Old) Now. 2007] [Bharathiar, BCom., November 2001; Oct. 2000; Bharathidasan, BCom Nov. 2001] * JAng: New profit sharing ratio: 29: 11:30} “0d ¥ are partners sharing profits and losses in the ratio of 7 : 5. Thay 1 ‘Weed 0 adimit 2" into partnership for ath sare in profits Po scape I ¥ - “areas = th fromm X and th. from Xe What is he new prot SIRE "i 24 8 "OPK. ¥ and 2914.89 eo + tas (Cg) i, Na lAng: jaring profits and losses inthe eatieg 4 $, hed D and gave him yy th share. This share was contri] " | .3, Find out ihe new profit and loss sharj rk » partners sh i 4 Bande were f Mey the rate of | ta a [Madras B.Com, BBA. BCA, ete. ACE) Og Ans: s $327, 1 are partners sharingprofits in the ratio of 3:2. Si ; admit! Akila and Ban ih 1 is admitted. Akila surrenders 3th share of her profit in Chandra Chandra and Banu ; thofher share in favour of Chandra. Calculate new. [Ans : New Ratio: 12:4, (i) Karthik and Sarathy were pariners ina firm sharing profits in the ratio of) I They admitted Doss to 3 share, What would be their new profit ratio in cach of the following cases: (a) If Doss acquired his share equally from old partners (b) If Doss acquired as Ko th from Karthik and Mo thtrom [Madras B.Com., B.Cam (CS) April JAns: (a) £3; 7: 10; (b) 21: 19: () Rand S are the partners in a firm. They admit M into the firm, The ne is agreed to be 5: 3: 4. R and : Caen es ee Hint : Old [Ans : Old ratio: 7! + Old ratio « New ratio af old f a partners + Sacrificing ratio. Calculation uf Sacrificing Ratio 2 ‘ "ents Profits in the ratio of 3 : 2. Z joins the firm with ye Find out sacrificing ratio, Hint: Inthe oy Mio ato information, Sacrificing ratio isthe sam and ¥ Zi ‘ ,fo pare! = go (Maitray Bc, 15.90 om, B.C f Om (CS) Now 2007) yd ¥ a0 sharing profits in the ratio of 7. 3,7 ’ vhs ' A 413333 2. Find out the sacrificing rai Y [Bharathidasan, 5.Com. November ?a04, : 7 sata wits Ans : Sacrificing Ratio : 2+ god Qare sharing profits In the ratio of 43, "R* isadmitied ea . ven ratio aT POR is 2: 2:3. Find out the setticcan io /Madras B.Com, B.Com (CS) Nav, 2005; April 2005 i: artne JAns: 2; 1) pand Q.are in partnership sharing profits and Josses in the ratio of 3-2 sdmit R into partnership on his payment of Rs. 10,000 4s capi ed gx 4,000 as his share of goodwill, ‘R" is given a fourth share in the profits and Pand Q are, between themselves. to share profits and Tosses equally, Iournalise and show the sacrificing ratio, / [Madras B.Com (C8) (S¥2A) Nov 2008) {Ans: Sacrificing Ratin: 9 : 1) , n | andl Gerificing Ratio and New Profit Ratio (i) Thangam and Nathan share profits in theralio of 5: 3. Saravanan joins the firm for 3 share of profit and brings Rs, 3.000 for goodwill. Caleulate the new ratio and sacrificing ratio, [Bharathiar, B.Com April 2000) JAns : New profit sharing ratio : 25: 15:24 Sacrificing ratio: 5: 3] (A, Band C were sharing profits'in the ratio of 4:3 = 2. 1D was aint on Ist the new ratio and sacrificing Jun with 14 interest in the business. Calculate in the tio, What will be the sew ratio and scriing avo iE . ofits of the business? ‘Com Now, 19M : is of ies of previous Preceding four years. The prolits of 16,000; 2002: Rs. eid, 2003: Re: £8,000: 20 ue "alue of, i i 5 " we = pn cm aFinancia) A 159)_— he bs oF 29a punch of Th) Go lued:an the basts 2 ; (by Goodwill is beck ea The profits of the previous three wate other eyed pee eR $6,000, 2006: Rs 68,000 204° ai rofit: (6) Value of goodwill fitadens: B.Com, Bi Coma tetas JAns: (a) Rs. $6,000; (p) 1 by) i 1 While admitting Ravi as a partner. goodwill in the books otc { as 4.500. On his admission. the Goodwill was valued on the yeas purchase of the average profits of the preceding S years. The weg previous five years were 1995-96 profit: Rs. 9,000; 4 Profs of. Rs. 10,000; 1997-98 profit: Rs 15,000; 1998-99 loss: Rs. 1 ue 2000 profit; Rs. 30.000 Find out Goodwill. 2.009 {Madras B.Com (CS) (SY2Aj Noy » Ams: Rs, 20, 44,000: P Calculate (a) Average F id) Calculate the amount of Goodwill in the following case Three years’ purchase of the last four years’ average profits is agreed »; i goodwill value, The profits and losses for the last four yenrs are, Rs Rs. | year 5,000 Ilveur 8,000 Ml year 3,000 (loss) IV year 6,000 [Ans : Goodwill Rs. © K and L are partners sharing profits in the ratio of 2: § They admit Ma | partner for 3 profit with effect from 1.42011 on the condition that he sto bring Rs. $,00,000 as capital and his share af goodwill in cash. Goodwill i ascertained on the basis of 3 years purchase of weighted average profit |ast3 years; weights being 1, 2 and 3 The profits of previous tree —— 2008-09 Rs. 10,00,000; 2009-10 Rs. 12.00,000; 2010-1! Compute the goodwill to be brought by M and Pass necessary Journal [Ans : Goodwill to be brought M. Rs. 97 ‘Weighted average profit Rs. ! o) Dhana and Balu had a firm in which they had invested Rs. 1,00.000 082 Nsrage the profits were Rs. 32,000. The usual rate of earnings inthe, , parine! _ Hig: jp imierest expected from capital having regadie ike SANE the risk involved iy muneration 10 the partners for their services fix 12,000 p. . a |Ane: Go a profit of Re, 15,000 per yenr fin th cans aprorit of y ie ume business 9 | return ily expected, The total assets of the firm are Rs. 2,00,000. Tinie a ipiltics is Rs 60,000, Find out the value of goodwill by Capitalization at xgottiod |Ans: Goodwill Ra. 19,000) speatment of Goodwill guenxshl8 fully received for new partner's shire of goodwill: 4 and B share profits in the Ratio of 5: 3. C joins the firm for i share of afitand brings Rs. 6,000 for goodwill. Calculate the distribution of goodwill, |Madras B.Com... (PZ2A) Nov. 2004) | Ans; Goodwill distributed to A: Rs. 3,750; B: Rx. 2.250) anal and Babu share profits in the ratio of 2:3. Chandru js admitted and new ratio between them is 2: $ : 3. Chandru brings Rs 3,000 towards goodwill, which is to be retained. Pass journal entries. (Madras, B.Com, May 1995} ita: Goodwill to be credited to old partmers; Aral Rs. 2,000; Babu Rs. 1,000) \) A, Band C are partners sharing profits equally: They admit D into partnership t for [th share in the future profit. D isto bring in Rs. 9,000 for goodwill. No ftw account appears in the books. They withdraw half of the goodwill lournalise. Madras, B.Com, May 1996) | [Ans : Withdrawals Rs 1,800 exch by Band Cl . ‘0 Aid Bare fit an tosses in the ratio of: 4 Theyadnit \ nia partnership. C pays a premium of Rs 12,000 for ah sae: P=? + by Co Re OST oy B's share of gr ronan Moorthy Macey and Mohan share profits in the ratio gf > tant > 16,000 for “Hew partner, Moorthy tyrings Rs. 20,000 for 3 stom eee 4 odWwit Half af the goodwill amount is wiht "Journal eniies The new eof sharing 0 7______ Fria Madras B.Com, (PZA, ft ) Bes, 2005 1593 1 ; 5 ; ACS (i a.com (C3) April 2006 ( 3 fa BCS (SY2A) Aprit 2004 ,! JAns: Sacrifice Ratio of Maran and Moban ought: Maran Rs. 10,400; M el Share of goodwill br fits and losses in the a ratio of 4 - uy ih Aand B ore partners sharing pro! | admit (C° inte parinership to 5 share who pays Rs. 3,500 in i goodwill A and Bdecide to sha good will appears in the books. goodwill [Thiravalluvar BCA Nop, {Ans: Sacrifice Ratio of A and B: 6: 1; Share: A Rs. 3,000; B: Re (g) A nnd B are partners sharing profit in the ratio of 3: 2. They admit C into partnership firm, C paying for premium Rs. 1,000 and for capital Rs. 10,000, goodwill account appears in the books. Old partners withdraw the amount. New profit sharing ratio is 2-2: 1. Pass Journal entries. \{Madtras B.Com, B.Com (C5) Apri re future profits equally among, Give necessary journal entries to recon ' [Ans: Sacrifice Ratio: A 2:8 Entire Goodwill brought by C gors 4 (h) Aand B are partners sharing profits in the ratio. of 3 = 2. They admit‘ pannersip. C paying a premium of Rs. 1,000 for + th share of profit new ratio is 3:3: 2. Goodwi necessary entries ill account appears in the books at Rs. 1.000:, partnet - sf _- ; gat rariners Sharing profits in the mig. ” ae ti 2 | ” C ma | ah share. His share of goodwill & a De » Rs.9,000 Give journal entries » gallo wini EASES ‘ non the goodwill is eccived in cash and retained ie the business. F hen the goodwill is received in cash and withdrwn hy old (Madras, BCS., (ICE) May 2001; B.Com. ; 1997) jaand Bare credited Rs. 9,000 in 2:4 ratio; (b) A and a, ee es 9,000 in Zz Fatio and they withdraw the amount credited ash is partly received for new Partner's share of poodwill ‘ t ‘ es od Bare partners sharing profits equally, They adimipc THO partnership, anes 1,000 for premium out of his share of premium of Rs 1.800 for 4 th ’ 4 wre of profit, Goodwill account appears in the books at Ra 6000. Pee wamal entries [Bharathiar, B.Com Aprit 1999) ie Exating good will Rs. 6,000 to be written offin ald ratio of 1. As. 1.000 tw be received from C as part payment of goodwill, Goodwill to be debited Rs, 1,000, °C’ to be debited Rs, 800 and A & B capital A/es to be credited in sacrificing ratio of |: 1) » Sant K are puriners sharing profits in the ratio of 3: 2. They admit L for 1th dure L pays Rs. 30,000 for capital and Rs. 10,000 out of his dare of goodwill whet is Rs. 15,000. Pass Journal entries. |Ans: Rs, 10,000 to be received from ‘L’ as part payment of goodwill: goodwill account is to be debited with Rs. 10,000, ‘L's capital account with Rs, 5,000 and ¥ & K capital accounts are to be credited in their sacrificing ratio of 3+ 2] * Chiland Dhl are partners sharing profits and losses equally, They admit il tr Yth share by paying Rs: 5,000 out of his share of RS: 9,000 gondwil ‘codwill already appears in books at Rs. 30,000, Pass journal entries: | JAns: Existing goodwill Rs. 30,000 ist be written | of im the old ratio. Rs 000 t be recived (om Gil as Pt payment of goodwill, Goodwill Acount tbe debited =I Ms $000 G's capita acount dite WA Cu and De po wer eel share — a a ttn Rs 40000 1" profits. Zen brings in Rs: 30, his ca cil ppearo wee ote 10,000 for goodwill, Bef admission RS. 18,000, Give journalis95 Fasting 200d tobe writen ga ae Rs. 30,000 to be received for capital and Rs, 8.9." payment of goodwill from Zen, 4 is to be debited with Rs,8,000, Zen's Capita) <4 with 2,000 and Ken and Yen capitaj ag. to be credited in sacri) icing partners in a firm sharing profits in the ratio of}. ; (e) Dim and Gim are th . admit Kin asa new partner for share. The goodwill ofthe fiemis i ars in the books at Rs, 10,000, k; Rs. 20,000. Goodwill already appe : Kin i 60% of his share of goodwill and Rs. 80,000 as his capital in cash, Teg of goodwill brought in cash is W ithdrawa by the concemed % extent of 30% of whatis credited to them. Give journal entries to adjust a jAns: Existing goodwill of Rs, 10,000 should be writes. in the old ratio: Rs. 80,000 as capital and Rs.2,400 (28,000, \ (3,000x 60%) as part payment of goodwill are to he rec from Kin, Goodwill account with Rs. 2,400 and Kin's capi account with Rs. 1,600 are to be debited and Dim and Gim ex accounts are to be credited in their sacrificing " (iii) When no cash is brought for new partner's share af goodwill = 7. (a) Xand Y were partners in a firm sharing profits and losses in the ratio of $ They decided to admit Z into the firm w2 th share of profits. Goodwill aoc stood in their books at Rs, 8,000 and it was valued on the date of admission Rs. 27,000. Give the journal entry required. Boodwill at 6,000, Z is admitted with $h share of and bri Rs, 30,000 as his capital but : ety RS. 9,000, Givejoumel ena an =o bring in exah forbs sre: fcor ga parine ——___ (Bharathiar, & Gap —— 15.96 Ans: Debit c%, Abel 2069 ca Mf credita’s AleRs, snnaee RS. 5,000 ang 1K were partoers ina firm sharing profits Ale Rs. 2,000), oh , gdmitted “S” as a pariner and the new and losses, _adwitl did not appear in the books on thi eet 6,000. Show the journal entry for the recy wo = x os Boodwill, (Madras B.Com, B.C, ‘om (AF) (AFSC) Now 20 ze 7 pebit'S’ Rs. 6000 and credit it fully ees No sacrifice) nd B Share profits in the ratio of 3; 2.°C” isadinited wih 3 th tare and is ' to bring Rs. 2.500 towards his. share of goodwill which he is unsble to oso, No goodwill appears so far in the books. No goodwill is to appear in the glance sheet in the future also, Pass necessary journal entries, {Madras BCA/BSC (Z PAK) Nov. 2007) {Ans: Debit C's A/e Rs. 2,500 and credit itto A &B in 3:2 Ratio) \el and Nel are partners sharing profits in the ratio of 3 : 2, Theirhooks show goodwill at Rs, 50,000, Kel is admitted with 1; share of profits and bringsin Rs. 1,00,000 as his capital but is not able to bring: in cash for his share of coodwill Rs. 25,000. Pass journal entries. |Ans: Existing goodwill to be written off in the old ratio, Rs. 1,00,000 to be received from Kel towards his capital. Kel's capital ra a debited with Rs, 25,000 Mel and ‘Nel capital accounts are credited in their sacrifing ne » On admission of Bin, it was agreed that the goodwill of Rin and Sin should previously Rinand Sit Valued at Rs. 45,000, Bin is to get YZ shire ofprofts PES Pass cash forgoodill fared profit in the ratio of 2: 3. Bin cannot ring in 8 spo good journal entries when in the books of Rin and Stn: acon at Rs. 15,000. count and (b) Goodwill appears wun ns 900 (aso00=6) \Ans: (a) Bin Capital account to be debited ratios “1 Rin and Sin capital accounts (© be creed ein net Bae (b) Existing goodwill of Rs: 15,000 = ps. 9,000 208 Rinand Bin capital account to be debited reps acount= Financia 1697 i in kind y is brome ' : ng her «ina firm sharing profits in the mtio OF3.52. Op, Aand Mare partners 4-2/4, th share in the profits. The NPL . jasanew partner for 7\0 " Hm ghey niet synod the following assets towards his capital ang tone } © 2 oni 4 J con : cock Rs. 90,000: Debtors Rs 1,30,000, Land Rs. goodwill Stoe 150,000. On the date of admission of J, goodwill of Mag Machinery Rs 9.60,000, Record the necessary journal entries inte ed valued at Rs. 1 firm on J's odmission. [Ans: J’s share of goodwill: Rs. 212,000 (a 6p x) J's share of Capital: Rs. 3,78,000 (590000. y's entire share of goodwill is to be transterel A’y Capital account as-M has not made any suerig, (vy) Hidden Goodwill a 9. (a) Xand Y are partners with capitals of Rs. 26.000-and Rs. 22,0000 respectively i : They admit"R? asa partner with th share in the profit of the firm: R brags Rs. 15,000 as his share of Capital. Give journal entry for ood wi (8) Ali and Ball are equi! partners in a firm ‘Their capitals show credit balances of Rs. 36,000 and Rs. 24,000 respectively. A new partner Chali is admitted wit Yt" share in the profits: He brings Rs; 28,000 for his eapital goodwill of the firm atthe time of Chali's admission,ga Parte! - ie ‘ [Ans: Ra. 3.20,000 ta be racaecpe——— Narayan's Capital account (o jyp on Vishnu and Viradha capital guia Rs. 26,067 and Are Wo be eredited ficing ratio, Value of Goodwitt- ? iheir sacri “sodsil: 80,000 (9,60.00.8.40,099 aan afte partners ° z al wy are (n partner ship sharing profits and losses in the ratio af 3. 3 pity Rs. 4.0 cana . gx 15,000 as goodwill for y rif shave of profit: They then admitted "P* nig : merdhip o” condition that "P" isto pay Rs 70,000 as capital and Rs. 18,000 pw, The partners agreed to share futtire profits in the mtin of 43.2 = (og! into partnership on condition that 0" is to espentively = {Ans: (a) on O's admission: Rs, 55,000 is to be received from 0, Goodwill a/c to be debited with Rs. 15,000 and M and N capital accounts are to be credited in the sacrificing ratio of 4 > I: (b) on P's admission: Rs. 88,000 is to be received from P. Goodwill account is to be debited with Rs. 18,000, MIs capital account is to be debited with Rs. 12,000 (13,000 19 = 1,80,000% %q(enin ratio)) and N's capital and O's capital are to be credited in their sacrificing ratio af |: 4] landry exercises relating to goodwill ) Op the admission of Shankar, it was agreed that. the goodwill of Radha und Krishnan should be valued at Rs. 60,000. Shankaris to get a i pod :2. cota rier aes, wien: er é ) ne ae . nie (ili) nce ene ae sith Rs. 12,000 x04 partners in oll ratio. ‘Then same as in (i) above (il) ™ eer" 80,000 by debiting old partners in old ratios 7Fj ay — a ——— hav are partners sharing profits ang losses i Me, = (b) Milind = earcias new partner who pays Ry 40.000 4 teat They admit 7” 13:1. The goodwill of the firm is to be base ti ew ratio ee wverage of 4 years’ profits Which were Rs. 18.009, fe ae, purchase of ns 10,000, Give journal eh fen At) Miia pays te t oe venti he is unable to bring cash for goodvwii}, = in cash and IM Muy [Ans : Manohar's share af goodwill = Rs. C000; Birms Food (a) Cash received for goodwill Rs. 6000 is 1 - "edited 4, partners int : Sratio. (b) Debit new Partner Rs, 6000 ang iy Partners jn nm (c) Shinu and Baby are partners sharing profits in the ratio of 3 - 1 Thy sng Maha as a partner for jth share His share of goodwill is Ry, ota, joumal entries in the following cases ® When the amount of goodwill is paid privately (b) When the goodiwill is received in cash and retained in the busines, (e) When the goodwill is received in cash and withdrawn by the old patter, TAMS: (a) No ent (b) Cash to be received from Maha, Debiting Goods, Account with Rs. 54,000. Shinu and Baby Capital accoum are to be credited in ie (c} The same treatment as given in (b) and Shinus Baby capital accounts are to be debited and ens (b) 'sunable to bring in cash for poodwill |Ans: Value of goodwill Rs. 96,000: (a) Rs. 19,200 to be received fr ‘account to be debites Cam Capital accounts to be credited (b) Pam’s capital accountto befa partnee of ved Prot & Losses 18.100 je 3. On 1.4.2008, the firm's books spe rais and losses in the a 040 On the above date, they decided to admit aa ® teserve fund of pass journal entry "Mto-the partnership, (Madras B.Com. B.Com |Ans: Amala gets Rs, 30,000: ao 5 Vimala thei and Sumithra were partners of @ firm shart HGR E32. On 31st Dee. 2007. the firm's bocksdavetia nae ¥ 50,000 and profit and loss Account showing debit bala marten on the above date they decided to admit Pavithra into the part te journal entries: (Madras B.Com, B.Com, (C5) Nov 2008) [Ans: Net credit to °G': Rs, 12,000 ‘S': Rs, 8,0} \and Y are partners sharing profits and losses in the ratio of 3 : 1. They agreed 1 admit Z into the business. Z is to get > th share of future profits. At the time of 2's admission, there was a General Reserve of Rs. 8,000 appearing in the balance shect of X and Y. Revaluation of assets and liabilities resulted in gain of Rs. 4,000. Pass necessary journal entries on Z's admission. [Ans : Both General Reserve and Revaluation profit are to be apportioned in the old ratio and credited to the respective old partners’ capital a/es,) laluation of Assets and Liabilities * (i) Kannan and Sundar share profits and Josses in the ratio ofS +3, Madhavan joins ase partner on 1st April 2007. The following revaluntions are made (8) Increase the value of building by Rs. 10,000; {t) Reduce the value of debtors by Rs. 2,000. Give journal entries and prepare revaluation account. o 2006) [Madras B.Com, B.B.A. BCA. et sae te ee in the rao of 322. | be decide to admit Jothi into the | tities as indicated here under: hich had ot $0 far Been '9) To bring into record investment of Rs- 44,000 = iy) ‘Teatded in the books of the firm. ps 18,000, Rs. 6.000888 ) To depreciate stock, furniture and machine? 2 Se Rs. 30,000 respectively. ase 74,000. prepare revalaation To Provide for workmen's 2008) account. B.Com. p.com (C9) a0 % o_o—— Fi ners sharing fits - partners sharing profi ind t ws Oe eae and Laxman were ~ an and Liv a" é : {e) a In view of Velan's admission. they decided to a mat liabilities 8S indicated below reval; z To Increase the value of buildings by Rs. 60,000; Provision for doubtful debts to be decreased by Rs, 800 hinery by Rs. 16,000: Furniture by RS. 4,000 and sg by (a) (b) (c) Todecrease mae Rs. 12,000 (d) A provision for outstanding liabilities 10 be created at Rs, my = revaluation account. [Madras B.Com. B.Com (CS), Nov. [Ans: Profit on Revaluation; Re, 200 (d) Sayce and Sekar are partners sharing profits in the ratio of 5; 3in vie Subbu’s admission, they decided to revaluc their assets and rev af indicated below: bs (a) To increase the value of building by Rs. 32,000 b) To bring into record at Rs. 14,000, investments = Samora nen ae ah nae he (c) To decrease stock by Rs. 12,000 and furniture by Rs. 11,000; (d) To write off sundry creditors by Rs, 11,000. Show the profit or loss on revaluation. ea {Madras B.Com, (PZ2A) Nov. 204 fe) Aand B are partners sharin fits inthe : shoel lhc tis esen' | AHO ratio of 32 ee \ ioe hi ‘Tavestinenty © oe con® (O10 oat pale | 20rm ea | grand B' were partners. «eta 2 Rm r) They admit“ with y {profits of the firm. “C* Contributes Rs. 15 eequted amount of capital of “AY and “Re. 0 as his capital. Cate /Madras B.Com, B.Com (C3) Now. Shorahidesen’s B.Com, grt 1999 Ans: 27,000; B: Rs. 18,000) ) Zthenew partner has been asked to bring sufficient capital forhis 4 3 thshare The combined capital of X and ¥ in the new firmis Rs. 1.32,000. Find out the amount of capital which should be brought by Z [Ans : Z should bring Rs. 22.00 (8, 44.000 i) P.Qand R are the old partners “1+ ona i admit’S’ for th share for which he brings Rs. 96,000 as cap decide to make their capital accounts iin the profit shar capitals of P. Q and R [Ans ; Adjusted Capitals ; P ; Rs. 288,000; R: Rs, 1,44,000; § : 96,000 New r 4) Aand Bare ere a Rs 12,000 and Rs. 5.400 respectively: C is tenet Profit with» capil oP 70a.15,103 Financial ES HLOTHER EXERCISES ; “ A‘ and ‘B’ were pariners sharing profits and losses in the ratio'of2 - . hy | Sheet as on 31.12.2003 was as follows Liabilities Rs. | Assets - " Creditors 5500) Ct 1.200 Capital: Debtors 9.700 A 30,000 | Stock 20,090 B 20,000 | Machinery 35.000 Building $0,909 ir — 1.15,900 1,15,909 _ They devided to admit ‘C’ as a partner for ¥ rd share in the profits of the i subject to the following conditions GY That he should bring in Rs. 15,000 as his capital gir” That the value of stock and machinery be depreciated by 10% (i That the provision of 5% on sundry debtors be made for doubrful debs (af That the value of buildings be appreciated by Rs. 9,500. Pass journal entries, prepare necessary ledger accounts and Balance after C’s admission. ma ™ = /Madras, B.Com, April 2004) [Ans: Revaluation profit: Rs. 3,515; Capital Account | Balance: ‘A’ Rs. 32,343; ‘BY Rs, 21,172; °C" Rs. 15,000; 2. The following is the B: mon ~ , owii . si a aon ing is alance sheet of Khan and Jain a partnership business, as Lapis Rs.) Assets Rs 12,000 40,000 30,000 : $0,000 Jain 54,000 Fi ; 0,000 bf 142,000 = 1,42,000 ‘The partners decided to revalue the asaew, Toahcuetl the ee aentebings in Rs 30.000 a cap liabilities as under on the admisso* Rs. 36.000, “iN RS. 60.000; Debtors Rs, 27.000: Furniture Rs 9500 204 5°parmer — 4,000 inchided in creditears is Ho longer a Laity = and henee: ‘equines “i yar OF . a nd Rs. 2.000 stiwstedl isto be paid to the creditors wh - jability of Rs. 300 net included inthe 7 above Balunee sheet had vo be yj entries and. prepare Revalumtion A/c, ju /Narang’s adnission ariners copital accounts. and [Ans: Revaluation Profit Rs, 3,000; J Ca Balance: Khan: Rs. 49,500; Jain: Rs, $5,500; ip hat contingent liability of Rs. $00 seen eae ne thal canting y is paid off since itis given as ‘had wo agsut hecleared \ gd Y were in partnership sharing profits and losses in the rato ¢ Sheet on 31.3.2011 was as follows: of 22. Thee Hatanes (uabulities Capital Ale They want to take Z into partnership subject to the following terms: WW Z pays Rs. 25,000 as Capital for 1h Shae bose ‘9 Plant and Machiner» be increased by 20% anid Land & Buildings Rs 20,000. ~ vision for doubeful dabts be increased 10 Fs 3000) tie lai "Anim of Rs. 2,000 included n Sunde Creditors sro is > ' (tn ements amounting oR. 13 40000 HE = 2!) should be brought into accoultl ‘aje and Balance Sheet Revaluation A, Cuplel Ale SS Peas trvieg entries and prepare be reduced 10 Pm ieee xm 7208 — 2 Rs.25:000, ws 108 alfeet stood as follows: Rs | Assety On 1.1.84 their Balance sl : 1s.108 oo Ac a eK and © were partners it firm sharing profits and losses In the Fao . Liabilities ea a Rk Ae « Coit Capital Accounts 1 7“ 10,000 | Land & Building 4 thea B 3,000 | Machinery 5 c 2.000 | Machinery Replacement Genetal Reserve 2500 Investment 1.700 | Machinery Replacement Furniture isto mete Fund 2,000 | Investment | Investment Fluctuation fund 2,000 | (market value Rs, 2.800) 3,009 Creditors 13,000 | Current Assets 12300 | ae 7 34500 34,500 | — — 4 What cnirics are necessary in case D is admitted on the above date? [Madras, B.C JAns: Rs. 3,300 will be credited to old partners (2,500 + | | 1006)) S. (Memorandum Revaluation) : The following was the Batanes sheet of Jaya and Samy who were shoring profits 34 rd and y rd respectively on 31.12.04f , Partner ag OFS = —— ait yc of assets and [ia — 20,438» Ananthi Re. t Is, Balance sheet Ti «Re va otal: Res, 139; ving is the Balanee sheet of X and ¥ (who share 90H) e Profits tn the ratio of 3. a Liohilities Rs. | Assets he Buildings 30,000 x's Capital 20,000 | Stock 15,000 y's Capital 25,000 | Debtors 10,000 Creditors 13,000} Bank 5,000 60,000 60,000 ja the date, ‘2.’ was admitted’as @ partner on the following terms 4) He will pay Rs. 25,000 as capital. 1 2 ) He will pay Rs, 10,000 as goodwill 5th share in the pros of te fm ) The assets are to be revalued as under: Rs. Buildings 40,000 Debtors 9.000 Stock 14,000 capital Aosouess te jul oes treo tone, eee A slnce sheet. Also find new prot imine May 19971 Ans: New ratio: 122825! om 32.0 2: Re 2 Capitals: RIA ' se gua we MT =Finaneigy < es sharing pruitite ithe ratio of J ‘Ch . y ace parine eT rare’ 2 >» 1. C beings in cash Rs 8,000 For capital ana yet profits shar ve Hhalance Sheet of Annd B ts as follows * Ly = geod E insets Lpabites Rs 1 ee hy Goodwill a = 8,000 | Assets 17,506 ; 8,000 8 Reserve 4,000 — 20,000 20,000 ae ae Give journal entries and prepare Balance Sheet of the new firm, (Madras, BCS. Oe. iyy |Ans; Balance Sheet total — Ry, 2>. 5m Capitals - A: Rs. 10,900; B; 8,600; C; Rs, & The following is the Balance sheet of X and Y (Who shate profits on the ratio or 3: 2)ason 1.1.97 Liabilities Rs. | Assets he (On the above date, 2 was admitted as # parmer on the following terms: 0) He will pay Rs. 25,000 ns capital He will pay Rs 10/000 as goodwill for Vth share in the profits of theft OW The nets ie: stock Re. (add ts 8 under: Buildings Rs, 40,000; Dewars Rs: 900% Give Journal entries suns nd alan sheet nee Reventon eo [Madras B.Sc. May 9°" Capit lAns: Revaluation profit "ecounts Balance: X Rs, 30:800; ¥: Rs 3228 % Ne. 28,000; Balance sheet Total RS.partner si0l ot ners 8 pains ship Baia ggg i) Asi a rs if & partnershj , |. The position of their baldness aaah atmos I MS 8 hon the Ry Assets cls capital ya's capital senor RESEVE canfry CHEAILOKS aan AC bn 14.2000 Arjun was admitted as a partner with 1/5th sare in following are the terms for his admissian: future profits 4) Land and buildings be valued at Rs. 80,000 ib) Value of the furniture and stock be reduced by 10% i) Goodwill Rs. 10,000 brought in cash by Arjun. id) Arjun tobring Rs. 20,000 as his capital. ie) Provision for bad debts be increased to Rs. 1,000. ( Prepare necessary Ledger Accounts and Balance Sheet of the newly constituted fir [Madras, B.C.ABSe. April 2000} {Ans: Revaluation Profit: Rs. 17,000; Capital Atul: Rs. 76,500: | Asha: Rs, 58,500; Arjun: Rs. 20,000; Balance Sheet total: Rx. 1,92,000) ". Aand B share profits in the proportions of three-fourths and ” Glance Sheet on 31.12.2010 was as follows: baits Rs.) Assets & Sundry Creditors Cash at bank ] Capital Accounts: illsReceivable 16000 : 30,900) Dede 20900 B 16,000] Stock 1,000 Land & Building® si15.109 — — Fikii On 11.2011, C was admitted into partnership on the following feqqaa 1. That C pays Rs. 10,000 as his capital for a fifth share = 2 That C pays Rs. 5.000 for goodwill Half of the sum is to be and B ithdrvn hy 5 3. That stock and fixtures be reduced by 10% and a 5% provisi debts be created on sundry debtors and bills receivable. for dott 4, That the value of Land & Buildings be appreciated by 20% §. There being a claim against the firm for damages. a liability to the 1,000 should be created. EXENt af ey Show the P & L. Adjustment Ave and new Balance Sheet rs (Mactres, B.Com [Ans: Revaluation Profit Rs, 950; Bis total Rs, 19 Capital A: Rs. 32,587.50; By Re. 16,962.50; C; Ry IL (Memorandum Revaluation) ‘oq The following was the Balance Sheet of A. B and C who Were equiil paring 313.2001 a F | Liabilities Rs | Aamets th Bills payable = Creditors ‘Capital A’c They ngreed to take “D" into partnership und give him aital fotos a (1 Stock and Furniture be depreciated by 10 Poison of Debs ae fr bt" olf pt ee ol ae — gevaluation) | h yas the Balance sheet of Ram, Lax March 2 200! w- , cals ing [st ansrerere reitors agin APC rpeyagreedto take Krishnan into/p onthe following terms: (i) That Krishnan should during in Rs. i) rut one half of the goodwill (ii) That stock and furniture be (wv) Thata provision of 5% on (vj Thata liability for Rs. 2,160 (ri) That the value of the buildin at Rs, $4,000. (i), That the value of abilities and Live the entries necessary to fael {> and — 13 Raviand Muthw share profits in the propartion oF 4 The Balance Sheen 34.12.2010 was as follows Assets sa 7 | Liabalites = Rs : Sundry cvaihand 83,000 | Cash at Bank Capital A’es Bills Receivable Ravi 60,000 | Debtors 32,000 Muthu 32,000 | Stock 40,009 Fixtures 2000 Land & Buildings 50,000 ——— 1,75,000 1.75000 On Est Jan. 2011, Rajini was admitted into partnership on the following terms: . (i) That Rajini pays Rs. 20,000 as his capital for a fifth share. (ii) That Rajini pays Rs. 10,000 for goodwill. Half of this sum isto be Withdrawn by Ravi and Muthu, | (iti) ‘That stock and fixtures be reduced by 10% and a $% reserve fordoubifuldehts be created on sundry debtors and bills receivable. | (6) That the value of Land & Buildings be appreciated by 20%, (8) There being a claim against the firm for damages. a [lability to the extent of Rs 2,000 should be created. ~ (vi) An items of Rs. 1.300 included in sundry creditors is bbe claimed and hence should be written back. r —s Make entries in the books of the firm i i ad Mutha nether lssuming the profit sharing ratio between Rav! Prepare Capital Accounts and Bive Balance Sheet, om [Mautras, B.Com) Ans: Revaluation Profit Rs, 3.200; Capital Accounts: Ravi Rs. 66.150: Muthu Rs, 34,050; Rajini Rs. 20,000: i ; B/S total: Rs. 2,053,900] 14, flowing ithe Balance Stet usa 30'9.20}| of Kumar ond Pandvan wh inal 3 Han hr rots nds nthe proportion of + and 5:yo A aint’ an 7 Rs. | Assets 15.412 hill — $s 4 30,000 | Bank —_ ews 2,600 | Debtors 45.000 3,500 Pps Less: Rese ar om | x cul a a 20,000 | Investment a ae 4.200 | Furniture as Plant & Machinery 9,000 Freehold premises sta 1.06,800 1,06,800 se admit Sharma into partnership form Ist Oct. 2011. Theterms of agreement are gonder sharma to bring in Rs: 12,000 as capital and Rs. 9,600 for 5 tnsharof goodwill doth these sums are (0 remain in the business. Sharma acquired his share equally fom Kumar and Pandiyan. | fs, 9,600 paid by Sharma to be credited to the loan accounts of Kumar snd Pandiyan in respective proportions. 5 Assets are to be revalued as follows: Freehold premises Rs. 30,000; Plant & Machinery at 10%, *) Investments, the market value of which at the date of the Balance Sheet is Bs 6400 fo be taken over by Kumar at that value. Reserve for doubtful debts is to be reduced by ©) Sarma paid the sum of Rs. 21,600 by cheque on Ist Oct. 2011. Make the required journal entries to give effect to the ahve em ee Sess of Kuna, Pandiyan and Sharma inthe books ofthe ¢ Sheet of the new firm. 48,4005 i Kumar~ 85 soe Revaluation profit Rs. 4,200; on Kumar 00 ind . Loan iyan Rs. 23,600; Sharma Rs. 12,000: vat of BS RE 12ST Pandiyan— Rs- Rs. 2,000Financial min 431.0.201 1 of Karnal and Siem whey noe sivewt as 4 1A Pile fainnaecage ve OP — toes Oe proportion of 1,2 8 ath partnership shart Pee medal A — Premises 2009 Viant & Machinery 9,000 Furniture Loo apaal Verret ai on om aa 20,000 | Debtors 45,000 i acs 70.800 | Les RD. _ #000 37,000 Bots payable 6,000 | Investment 8300 Bonk 3.500 1.04,800 1.0400 They mimat Vijay into partnership from 142011 under the following terma: 2 (i) Vigay to bring in Rs. 20,000 as capital and Rs. 9,600 for 77 th share of goodwill, The goods t/1 to remain ia the business. (i) Ager are to be revalucd as. follows: Freehold premises Ra 10,000; Plint & Machinery Rs. 8.000, Stock at 10% bess than the bork waluc (a) fewertments, the market value of which al the date of the balance sheet is Ra 6.400 te he taken ower by kamal at that value. (te) Reserve for doubtful debts to be reduced. to Rs, 6,000. Make the required journal entries to give effect to the above terms and draw up the scouunts of the partners and the opening balance sheet of the new firm. (Ams: Revaluation Profit Rs. 6400; Capital A/es ~ Kamal Rs. 51.200; Siva Rs. 26.400; Vijay Rs. 20,000; Balance Sheet total Rs. 14400) "6 Mohas and Nathan were partners shating profits in the ratio of 3 :2 They admis rev for 1 share of profits The Balance Sheet on the date oF admission we i Al |Part foi oft -qjesund prepare Balance sheet ufteeg E her Cy w Ne jyiowin / aan yo contribute Rs 60.000 a5 capital and Rs, 59 Ppa the firm is valued at 5 goa orl profil were Rs_ jen pure i are depreciated by 10% © cock isrevalucd at Rs. 20,000 pe vision for doubtful debts is increased to Rs, “ Ans: Revabah iow a Capital Account Balance: Mohan Rs. % Y Chetan Rs. 52,500; Balance jn. Goodsl Rs. 50,000 (50,000 — 40,000 = 10,000 » 5) rn —_ 10, Debit chetan ‘s capital ale . his share of goodwill and credit’ a 's capital we with Rs, 3,000, fi Sw pes Creditors Bills Payable Profit & Loss A/c Capital: Goodwill és valued at RS g Aectapotedl ) Clsto bring Rs. 1,50,000.a8 | is cur Hotoe car is valued at RS. 00;— Financiaj ists _——” ,oodwill of Rs. 40,000 in the o n AS. 10, write ofFextsting & wel Ndr eat Hint “As pet ! ry 10,000 (80,000 x & )—-6,000) for his share of py 4 L account with Rs: 4,000 and B's capital account ‘with a firm sharing profits and losses in af 000 was as follows: the Fain ri Rs. Cupital account with Rs credit A's capital Krishna were partner 1. Ram and Kris : 3) 1 Their Balance sheet as on 1.4.2 Rs Liabitittes Sundry Creditors Cash Debtors Capital Ram $0,000 | Stock Krishna 30,000 | Furniture Machinery 1,00,000 RAG They agreed to admit Laxman Into partnership. He agreed to pay cash of Rs. 20,009 to partners for goodwill out of his agreed share of Rs. 30,000. He brings in Rs. 44,000 py his capital, He is to be allowed 4 th share of profits of the firm. (i) Machinery und furniture are to be depreciated by 20% _ (ii) Stock should be depreciated by 10% (iil) A provision of 10% on debtors for doubtful debts should be made | Prepare Revaluation account, Partners capital accounts and the balance sheet of the firm as newly constituted. {Madurai B.Com, Aprit 2001] [Ans; Revaluation loss: Rs. 12,000; Capital account Balance Ram Rs. 63,500; Krishna Rs, 34,500; Laxman Rs. 4,000: "9. Aand B are partners sharing profits and losses in the a mae and the new profit sharing ratio is 2:2: | C brings in cash Rs, 8,000 for capt Rs. 2,000 for his share shel ot Asad i felons Mes mee wo be Re: 3,008 Taepares” —— ya Pa 1Bhy \Sit6 jAns: Capital Account Bala arathiar, 8.Com, < INCE: A: Rg, 11,900, ee 20) C Re. 7,000; Balance Sh jt) Ramu and Ravi are partners Sharin cpl on 313.99 was.as under. +h tet Total: iy. aan Tits the rata : 0 F Aglare jos cred yistanding liabilities Quist Capitals Ramu —-29,000 Ravi —«*15,000 tayas admitted as a new partner introducing capital of Rs, 16,000. The new profit opate decided as 5 : 3: 2. Following revaluations are made: ® Stock to depreciate 5% » Provision for doubtful debts is to be Rs. 500 © Depreciation on furniture is 10% ) Suilding is valued at Rs. 40,000 Pass Journal entries, prepare Revaluation account and Balance Sheet after the ‘tewadmission. [Pondicherry B.Cam., May 1999] [Ans: Revaluation profit Rs. 3,650; Sina. a Ramu Rs, 32,825; Ravi Rs. 18,095; Raja Rs 12, Hidden goodwill Rs, 16,380; Balance Sheet Total: RS 160150} ‘ ry ee Total Capital of the firm: Rs. 80,000 (16,000 194); capil of Rama Rama & Ravi shoud he: Rs. 64,000 (80,000 — 16,000) ; Asta capi! of ‘ier revaluation: 44,000-+3,650: Rs. 47,650. Midden Goodwill: 64,000 47,650 =Rs. 16350 ) W agp s.3270 (16380 “AS-10, debit Raja's Capital account with ps Lessand Phisshare capital ‘gfe Of goodwill and credit Ramus! iste l "Os cpl senna es 1,635 as the sacrifice st? ;isi? aaron ——_____Fitanciabng P| A and B shore profit in the ratio of 3 ' Their Balunce sheet as on 3p jy em isas under Kes. Fan | on Creditors 37,500 | Cash a hae Rg i General Reserve 4,000 ne Receivable 309 Capital Stock A 30,000 | Debtors thaca a 16.000 | Furniture 1,009 Building 25,000 — 87,500 87509 ee a Gn 1.4.2005 they admit C asa new partner on the following arrangement: (a) C to bring Rs. 10,000-as capital for 1/5 share of profit. (b) The firm's goodwill is valued of Rs. 10,000 (c) Stock and Fumiture to be reduced by 10%, a reserve of 5% on ehtors for doubtful debts to be created. (d) Buildings to be appreciated by 20%, Give the necessary ledger accounts and Balance Sheet. Madras, B.Com., Nov. 2005; Nav. 2004; Aprit 200)) [Ans: Revaluation Profit Rs. 2,100; Capital A/ve Balance: A: Rs. 36,078; B: Rs. 18,025; C: Rs. 8,000 B/s Total Rs. 99,600) 22 A. Hand C are partners sharing profits and losses in the ratio of i 252211 Balance shect as on 313.99 was as follows, — Liabilities Rs.) Assets & Creditors 12.850 Outstanding liabilities 4.00 General Reserve 6,500 Cupital: A 12,000 8 12,000 & 5,000 49,850 een. si following terms. ES! "tke D as a partner with effect ftom 1499/0" E aus 5.000 towards is apa for i, th share of profit of Eos wil be fxd at Rs 15,000 but 13 cannot ing any 8er (i partre gio ick should be increas — ene of 108% vased by Rs, 2.399 IS visto for bad debts should be provided aun — Silt “ be depreciated by 10% Of the dat jyynitre to . of and & building should be increased by 20% value _ Revaluation account, capital account of i nepl® Partners and Balance ; Sheet of the (Bharathiar, Ans: Revaluation profit Rs, cman gia Balance: A: Rs. 18,320; B: Rs, niece D: Rs. 2,000; Balance sheet wi a esse 45-10, Debit D's Capital account with Rs, 3,000 (15.000 yy) lelicdine goodwill and credit A’s capital account with Rs. 1,200, B's capital account 4 1 200.and C's capital account with Rs. 600. i » following is the Balance sheet of Active and Sharp who shired profits and losses in seratio of 3:2 Liabilities Active's Capital 30,000 | Goodwill ; 10,000 Sarp's capital 25,000 | Sundry assets $0,000 Sundry creditors - 10,000 | Cash 3,000 65,000 sae ton was admitted as partner on the dae of Balance shee. Theis Ti on tod losses will be 5 : 3: 2. Blunt pays RS bie avich has to be valued on the ass oF 2 ens pic 13796 fr} years were: Rs. 10,000; Rs. 12,000 and Rs 14,000, “he giving j ii journal entries and ledger accounts incom, ape 00 = es 2000 Capital Account Balance: Active: RE! spec ros =m Py plunt Rs. 15.200: nec 42008, owing is the Balance sheet of Ramu an! RABMUAS ST ate ~_ Mabilities —~ 00los: Ramu and Raghu share profitsand sees contributes Rs. $0,000 as his capital but cannot bring any amount for which is valued at Rs. 3,000. The new profits sharing ratio is3.2:2 4 show Balance sheet after Rasu’s admission. OUlrrali ge [Madras, BA Eco, Now, 2004; B.Sc, Mey _ Ramu Rs. 42,500; Ragho Rs. 37,500; Rasy Rs, Balance Sheet total Rs. 1 25. Nirmal, Jayant and Stalin were in partnership sharing profits and Yossey a ee | oe proportions of ¢. § and 5 respectively Their position on 30th Jute 2011 was, ses equally. Rasu is admitted on 1.4 2004 i ed jAns: Capital follows: Liabilities Re} Assen Cash at Bank 43.000 Trade Creditors Bank Overdraft 40,000 | Bills Receivable aon General Reserve 32,000 | ‘Trade Debtors i Capital Accounts: Stock in trade 70,000 Nirmal 40,000} F ae gee $4,000 | Buildings an Stalin 60,000 terms; (i) Raja to bring Rs. 50,000 as capital Gi) The im’s goodwill is Valued wt Rs. 80,000 (iti) That value of stock be reduced by 10% Cv), Buildings be apprecined by 15% (¥)_A provision for bad debts of Rs. 8.000 fe made (vi) ean pings claim for damages agains the Jin, alebiiny wcnenanotiastt (vil) Ani iol cluded in trade creditors isnot likely to be claimed and the new Tian + “os Adjustment Ale. Partners Capital Ales und Balance SO om oss Re. 7.296; Capital Ales: Nirmal- R&Snora Partner -——anErE 15.120 gor —__artners of & firm sharing Wofitrand lisecaia Ola i wet pasion was as given below in the ratio of 3, On sol a sites Re_| Assets tlie —ar's Capital 10,000 | Goodivitt = es Capital 6.000 | Plant 6000 Creditors 4.000 | Stock sho Debtors 4000 4.000 20,000 20,000 yw to join the partnership, He agress to pay the ‘es ace — Red introduce one hiif of the combined capital aac by way wal ing plant and stock at 20% and 10% against debtors. ee pi en, es \ th share of the profits of the firm. Prepare Revaluation account, Capital and Balance sheet of the new firm. /Madras, B.Com (CS) April, 2007] JAns: Revaluation loys Rs. 2,200; K's capital Rs. 7.900; Baiance sheet Total Rs. 27,700) Prennath and Jaisankar were partners in afirm sharing profits and lossesas Premnath 7S and Jaisankar 25%, Their Balance sheet as on January 1, 2011, was as given They agree to admit Sundari as a partner on the following terms ir Plant 10 be depreciated by 5% ) Stack to be increased to Rs. 80,000 109% of the Reserve fund is to remain as reserve for doubtful debts A tnbitty towards a creditor for Rs. 1,000 is not recorded wiich isto be . Swdariisto got + share ofthe future profits for which she S19 PS)" "alto her share in firm's goodwill valued at 3 yeas Pare ih da he les four years which ware oop — Rs 10,000 (Loss) 2010 — . ms 50,000, 2008 = Rs. 80,000; ae MIE required to give the profit & Joss Adjustment A/E sheet of the new firm.™ Financia, Is a Ans: Revaluation Profit Rs. 1000; P's Capjtay So | J's Capital: Rs. 1,12,750; Sundari's Capita ne Nitag goodwill brought: Rs. 40,000: Balance Sheet Total, Rs, «S88, | 38. X.and ¥ were partners sharing profits and losses in 7: 3 Their bittance a | me 34.12.2010 ts as follows: Assets Laabilities La Furniture Capital Accounts ‘ Stock 25,000 x y 20,000 | Sundry Debtors 23,009 7s Rane 5,000 | Less: Provision 1,000 Bank Overdrait 10,000 | Cash val Sundry Creditors 20,000 80,000 Bu 0m —— On 11.2011, Zw fl i} vas admitted as a partner for ay th share of the firtire profits onthe | following terms: (0) Goodwill is valued at Rs. 20,000 and Z is Necessary amount | Premium for goodwill, a =? | (Hi) th of the Reserve is to remain a5 4 provision against bad and doubtful debe: (ili) Stock is to be reduced by 40% and furniture reduced to 40% and i (iv) X is to pay off the Bank overdraft. mia (¥) Zis introduce Rs. 15,000 as hi Cr which amount Partner's Capital shull moe “= ag sp cural ces. opt accounts and the Balance shet of the nw im. ic on revaluation Rs, 19,000; Deficit in X's Capital én Sul i's Capi eR 30; ae sts Chandra Joya are partners ij sharing profits: Cus "Powe Kya 25%. On it amury 201 the eee cacao Hoabitiies Rs.) Assets aa * Capital Accounts S. Chandra K. Jaya Sundry Creditors [ElgeEprtiver _ ofa aes = is 4 , : : so" join) the partner ship. She agrees to. pay 12 ‘ whe Partners Rs, 20,006 by 2 of the combined capital of jwill and wmtroduecs f gom a f plant and stock the two existing 4 depreciation of plant and stock at 20% - wn after depre ‘Sand 10% Fespectively and ba reserve of 10% against sundry debtors, The me ee \ (the profits of the firm 4 em required to record the above transactions in the books ¢ sheet of the new firm of the firm and jive Sot Ralane JAns: Loss on Revaluation Rs, 12,000; Selvi's Capital Rs, 44,000; Total of Bis Rs. 1,52.000) qed Yarein partnership sharing profits in the proportion of 2 and : Fespectively. Ther Balance sheet on 3st March 2011 was follows: ashilities Rs | Assets Re (yeditors 800 | Cash 1,300 Capital Accounts Debtors 2,000 Xx 4,000 | Less’ Reserve _800 1,200 Y 2,000 | Phint 1,300 Stock 3,000 6,800 6,800, they decide to admit 7.10 a one-third shore upon the terms that he is to pay into the 1 hainess Rs, 2,000 as Goodwill and sufficient Capital to give him 3 Misharc ofthe niCapital of the new firm. It was agreed that the reserve for bad debts be reduced 1.4200. that the stock be revalued at Rs. 4,000 and that the plant be reduced to ,000, (24 Manohar ar partners in fin. They share profited loses in eo teseey Give below is their Balance sheet as on 3? * ities Rs. | Assets - Plant se 40,000 se 30,000 Receivable 10,000 me 5,000 1,35,000 |™ = __Financial Accoun,, He agrees to pay Rs, 18,000 a inti, re ngreed upon Prem Man now wants to join the fit dwill, Certaity revaluations of the assets we good eciation in previous years. was to be taised rs Ra ‘ m9 if) Plant due to over depr fly Stock was to be inken at Rs 60,000 | (ji) Mani wasto be given > share in the future profits of the firm and ines wm he agreed to introduce capital into the firm equal to double the adjusted can: the two existing partners. seh tals of Pass the journal entries in the books of the new firm and prepare the balance sheet showing the opening position of the new firm as on 14.20 calculate the new profit sharing ratio. A011, Als jAns: Revaluation profit Rs. 45,000; Mani’s Capital Rs. Balance sheet total Rs. 4.44,000; New Ratios; ; 32 Raghava and Vecra were partners in a firm sharing profits and losses 5 | respectively, Their balance sheet as on 31.3.2002 was: Balance Sheet inthe ratio op Liabilities_,ofa arte! re ng profits in proportion of grit and > showed the fo lowing as their 9 30,6,.20) Rs | Assets a ie Re —$__™ 37,500 | Cashvat bank 2500 am Reserve 4,000 | Bills Receivable 3,000 me capital 30,000 | Debtors 16,000 Capit 16,000 | Stack 20,000 Office furniture 1,000 Land & Buildings 25,000 87,500 87.500 They sdmat C into partnership on 1.7,2005 on the following terms: sup pays Rs. 10,000 as his capital for a fifth share in the future profits. That goodwill is to be valued at Rs. 20,000 Thy sock and furniture be reduced by 10% and a 5% provision for doubtful debts jecreated on debtors. That the value of land and buildings be appreciated by 20%, Tht the capital accounts of the partners be readjusted on the basis of their profits ssenng arrangement and any additional amount be debited or credited to theircurrent COUN Fass journal entries and prepare the profit & Loss Adjustment A/c, Capital Accounts ted Opening Balance of the new firm. (Madras, B.Com., Nov, 2005; 2004; B.C.A./ B.Sc. Oct. 1998; (Madras, B.Com, May 1995; B.Sc., Oct. 1996] \Ans: Profit on Revaluation Rs. 2,100; Current Alc A~ Rs. 9,525 B— Rs, 6,575; B/S total Rs. 1,03,600) Tefollowing is the Balance Sheet of X, ¥ and Z sharing profits in = 3:3 Mpectively_____Finaneiat 4, ii = | 0 take G into partnership and gave him 3 th share on the following They ‘agreed ti D Ps om) ti) That farniture be depreciated by Rs ‘ H (ii) That stock be depreciated by 10% ; That provision of Rs: 1.320 be made for outstanding repair bi}jy uD That the valuc of Rs. Land & Buildings be brought up Rs, 59,45, a That the value of Goodwill isto be taken at Rs. 14,070 (vi) That G should then bring in Rs, 14,700 as capital. (vil) Thotafter making the above adjustments the capital accounts ofthe oy be adjusted on the basis of the proportion of D's capital ta hig nee business j.¢. actual! cash to be paid off or brought iin bythe old ate case may be ee ‘the Pass journal entries and prepare Revaluation A/c, Partner's Capital AS an Ban, sheet of the new firm. / [Madras, B.Com, B.Com(CS) etc. April 2005; B.C.s, Ou B.CAJB.Sc. (ICE) Oct. 1998; B.Com, April 1998; BBM, March i997, |Ans: Profit on Revaluation Re. 9,520 ; Surplus in X's Capital Ve: Re Sap, Surplus in Y's Capital A/e: Rs, 3,400; Deficit in Z's Capital Ale: Rs. 139, Total Capital Rs, 1,03,528; X,Y & Z: Rs, 90, tot Balance sheet Rs. 1S 45. The following is the Balance shett of A and B who share Profits andl lotses }. 3 respectively, f Liabilities Re m Capital Accounts : 16.000) Plant 9.000 i 7,000) Debtors 4.400 Creditors 5,000] Less: Provision _400 4,000 Stock 7000 Cash 1,000 28000 They agreed to admit z) following terms: C into partnership giving hima fifth share onthe