Accounting for Partnership Firms (CBSE (Central Board of Secondary Education- Board Exam) Class-12 Accountancy): Questions 14 - 15 of 135

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Question number: 14

» Accounting for Partnership Firms » Fixed Versus Fluctuating Capital Accounts

One Liner Question▾

Write in Brief

How will you show the following in case the capitals are Fixed

b) Drawings

c) Withdrawal of capital

d) Interest on capital and

e) Interest on loan by a partners?

Question number: 15

» Accounting for Partnership Firms » Partnership

Essay Question▾

Describe in Detail

Anil, Jatin and Ramesh were sharing profit in the ratio of 2: 1: 1. Their Balance Sheet as at 31.12. 2001 stood as follows: -

 Liabilities Rs. Assets Rs. Creditors 24,400 Cash 1,00,000 Bank Loan 10,000 Debtors Less: Provision 20000 1600 18,400 Profit and Loss A/c 18,000 Stock 10,000 Bills Payable 2,000 Land & Building 20,000 Anil’s Capital 50,000 Investment 14,000 Jatin’s Capital 40,000 Goodwill 22,000 Ramesh’s Capital 40,000 1,84,400 1,84,400

Ramesh died on 31st March 2002. The following adjustments were agreed upon-

• Building be appreciated by Rs. 2,000
• Investments be valued at 10 % less than the book value.
• All debtors (except 20 % which are considered as doubtful) were good.
• Stock be increased by 10 %
• Goodwill be valued at 2 years’ purchase of the average profit of the past five years.
• Ramesh’s share of profit to the death be calculated on the basis of the profit of the preceding year. profit for the years 1997,1998,1999 and 2000 were Rs. 26,000, Rs. 22,000, Rs. 20,000 and Rs. 24,000 respectively.

Prepare revaluation account, partner’s capital Account.

Explanation

 (Dr. ) Particulars Rs. (Cr. ) Particulars Rs. To Investment A/c 1,400 By Building A/c 2,000 To Provision for doubtful debt A/c 2,400 By Stock A/c 1,000 By Loss transferred to Anil’s Capital A/c Jatin’s Capital A/c Ramesh’s Capital A/c 400 200 200 800

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