Raghu and Ramesh entered into a joint venture to
produce an advertisement film for Bharati Traders, at a contract price of
40,000. Raghu contributed Rs. 10, 000 and Ramesh Rs. 20,000 and opened a joint
account in the bank with these contributions. Raghu purchases from his own
funds raw film for Rs. 8, 000 and a Camera for Rs. 7,000 for joint venture.
They Paid from the Joint Bank Account: Artist’s fees Rs. 18, 000, Hire of sets
Rs. 2,000 and technician Charges RS. 10,000. The firm was completed but due to
certain defects in the firm, the contract Price was reduced by 10% the amount
being received by cheque from Bharati Traders. At the end of venture, the
camera was sold for Rs. 5,000 and Ramesh took over the unused film for Rs. 400.
Raghu and Ramesh shared profit and losses in the proportion of 1:2 and settled
account of the venture. Prepare the Joint venture Account the Joint Bank
account and the accounts of the Co – ventures.
Solution:
Journal entries in the books of Joint venture
|
Date
|
Particulars
|
Lf
|
Debit (Rs.)
|
Credit (Rs.)
|
|
? 1.
|
Joint Bank A/c ………… Dr.
To Raghu's A/c
To Ramesh's A/c
[Being the initial contribution is made]
|
|
30000
|
10000
20000
|
|
2.
|
Joint venture A/c ……… Dr.
To Raghu's A/c
[Being the raw film and camera purchased]
|
|
15000
|
15000
|
|
3.
|
Joint venture A/c ………… Dr.
To Joint Bank A/c
[Being the artists fees, hire of sets and technician charges paid]
|
|
30,000
|
30000
|
|
4.
|
Joint Bank A/c ………… Dr.
To Joint venture A/c
[Being the contract price received after a deduction of 10%]
|
|
36,000
|
36,000
|
|
5.
|
Joint Bank A/c ………… Dr.
To Joint venture A/c
[Being the camera was sold]
|
|
5000
|
5000
|
|
6.
|
Ramesh's A/c ……… Dr.
To Joint venture A/c
[Being the unused film was taken over]
|
|
400
|
400
|
|
7.
|
Raghu's A/c ………… Dr.
Ramesh's A/c ……… Dr.
To Joint venture A/c
[Being loss made on joint venture]
|
|
1200
2400
|
3600
|
|
8.
|
Raghu's A/c ………… Dr.
Ramesh's A/c …… Dr.
To Joint Bank A/c
[Being the final settlement is made]
|
|
23800
17200
|
41000
|
