CBSE (Central Board of Secondary Education) Class-12 Accountancy: Questions 176 - 178 of 216
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Question 176
Write in Brief One Liner▾
Name two methods for valuation of goodwill in case of partnership firm.
EditQuestion 177
Question 178
Describe in Detail Subjective▾
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:
Liabilities | ₹ | Assets | ₹ | ||
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: ₹ 15,000; 2002: ₹ 13,000; 2003: ₹ 12,000; 2004: ₹ 15,000 and 2005: ₹ 20,000.
b. Patents be valued at ₹ 8,000; Machinery at ₹ 28,000; Buildings at ₹ 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 ₹ 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.
EditExplanation
Particulars | ₹ | Particulars | ₹ |
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 & Loss Suspense A/c | 5,000 | ||
By Interest on Capital A/c | 1,500 | ||
61,500 | 61,500 |
Particulars | ₹ | Particulars | ₹ |
… (32 more words) …