Accounting for Partnership Firms-Reconstitution and Dissolution (CBSE Class-12 Accountancy): Questions 49 - 51 of 60

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Question number: 49

» Accounting for Partnership Firms » Reconstitution and Dissolution » Retirement and Death of a Partner

Short Answer Question▾

Write in Short

X wants to retire from the firm. The profit on revaluation of assets on the date of retirement is Rs. 10, 000. X is of the view that it be distributed among all the partners in their profit-sharing ratio whereas Y and Z are of the view that this profit be divided between Y and Z in new profit-sharing ratio. Who is correct in this case?

Question number: 50

» Accounting for Partnership Firms » Reconstitution and Dissolution » Admission of a Partner

One Liner Question▾

Write in Brief

What do you understand by admission of a new Partner?

Question number: 51

» Accounting for Partnership Firms » Reconstitution and Dissolution » Retirement and Death of a Partner

Essay Question▾

Describe in Detail

A, B and 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 as on 31st March 2005

shows available balance of assets and liabilities as on 31st March 2005

Liabilities

Rs.

Assets

Rs.

Reserves

10, 000

Buildings

20, 000

Creditors

7, 000

Machinery

30, 000

A’s Capital

30000

Stock

10, 000

B’s Capital

25000

Patents

6, 000

C’s Capital

15000

70, 000

Cash

21, 000

C died on 1st Oct. 2005. It was agreed between his executors and the remain partners that:

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

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

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

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

e. A sum of Rs. 7, 750 was paid to his executors immediately.

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

Explanation

PARTNER C’S CAPITAL ACCOUNT

SHOWS CAPITAL BALANCE OF C’S IN THE FIRM WHEN HE DIES

Particulars

Rs.

Particulars

Rs.

To C’s Executor’s A/c

27, 750

By Balance b/d

15, 000

By Reserves

2, 000

By Revaluation A/c

2, 000

By p& L Suspense A/c

2, 000

By Interest on Capital… (60 more words) …

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