CBSE Class-12 Accountancy: Questions 177 - 179 of 209

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Question number: 177

» Accounting for Partnership Firms » Goodwill

One Liner Question▾

Write in Brief

Name two methods for valuation of goodwill in case of partnership firm.

Question number: 178

» Analysis of Financial Statements » Financial Statements of a Company

Short Answer Question▾

Write in Short

what is contingent liability? give example of it.

Question number: 179

» Accounting for Partnership Firms » Partnership

Essay Question▾

Describe in Detail

A, Band C were partners in a firm. sharing profits in the ratio of 5: 3: 2. On 31st March, 2005 their Balance Sheet was as under:

BALANCE SHEET of the firm as on 31st march, 2005.

shows available balance of assets and liabilities

Liabilities

Rs.

Assets

Rs.

Creditors

7, 000

Buildings

20, 000

Reserve

10, 000

Machinery

30, 000

Accounts:

Stock

10, 000

A

30, 000

Patents

6, 000

B

25, 000

Debtors

8, 000

C

15, 000

70, 000

Cash

13, 000

87, 000

87, 000

A died on 1st October, 2005. It was agreed between his executors and the remaining partners that

a. Goodwill be valued at 2 years’ purchase of the average profits of the previous five years, which were 2001: Rs. 15, 000; 2002: Rs. 13, 000; 2003: Rs. 12, 000; 2004: Rs. 15, 000 and 2005: Rs. 20, 000.

b. Patents be valued at Rs. 8, 000; Machinery at Rs. 28, 000; Buildings at Rs. 30, 000.

c. Profit for the year 2005 - 06 is taken as having accrued at the same rate as the previous year.

d. Interest on capital be provided at 10 % p. a.

e. A sum of Rs. 11, 500 was to be paid to his executors immediately.

Prepare A’s Capital Account and his executors’ account at the time of his death.

Explanation

A’s Capital A/c at the time of his death

shows capital of partner A

Particulars

Rs.

Particulars

Rs.

Executor’s A/c

61, 500

By Balance b/d

30, 000

By Reserves

5, 000

By B’s Capital A/c

9, 000

By C’s Capital A/c

6, 000

By Revaluation A/c

5, 000

By Profit… (52 more words) …

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