Balbharati solutions for Book-keeping and Accountancy 12th Standard HSC Maharashtra State Board

Chapter 4 Reconstitution of Partnership (Retirement of Partner) Practical Problems [Pages 183 - 186]

Practical Problems | Q 4 | Page 185

Rohan, Rohit, and Sachin are partners in a firm sharing profit and losses in the proportion 3:1:1 respectively. Their balance sheet as on 31st March 2018 is as shown below

Balance Sheet as on 31^stMarch 2018
Liabilities	Amount ₹	Assets	Amount ₹
Creditors	40,000	Bank	12,500
General Reserve	50,000	Debtors	60,000
Bills payable	25,000	Live Stock	50,000
Capital Accounts :		Building	75,000
Rohan	1,25,000	Plant and Machinery	35,000
Rohit	1,00,000	Motor Truck	1,00,000
Sachin	50,000	Goodwill	57,500
	3,90,000		3,90,000

On 1^stApril 2018, Sachin retired and the following adjustments have been agreed upon.

1. Goodwill was revalued at ₹ 50,000

2. Assets and Liabilities were revalued as follows. Debtors ₹ 50,000, Live Stock, ₹ 45,000; Building ₹ 1,25000, Plant and Machinery ₹ 30,000, Motor Truck ₹ 95,000 and Creditors ₹ 30,000

3. Rohan and Rohit contributed additional capital through Net Banking of ₹ 50,000 and ₹ 25,000 respectively.

4. Balance of Sachin’s Capital Account is transferred to his Loan Account

Give Journal entries in the books of new firm.

Solution:

Journal entries in the books of Partnership Firm
Date	Particulars	L.F	Debit (₹)	Credit (₹)
2018 April 1	General reserve A/c Dr.		50,000
	To Rohan's Capital A/c			30,000
	To Rohit's Capital A/c			10,000
	To Sachin’s Capital A/c			10,000
	(Being General reserve distributed among partners)
2018 April 1	Revaluation A/c Dr.		32,500
	To Debtors A/c			10,000
	To Live Stock A/c			5,000
	To Plant and Machinery A/c			5,000
	To Motor Truck A/c			5,000
	To Goodwill A/c			7,500
	(Being assets depreciated)
2018 April 1	Building A/c Dr.		50,000
	Creditors A/c Dr.		10,000
	To revaluation A/c			60,000
	(Being Building appreciated and Creditor's amount is payable less)
2018 April 1	Revaluation A/c Dr		27,500
	To Rohan's Capital A/c			16,500
	To Rohit's Capital A/c			5,500
	To Sachin’s Capital A/c			5,500
	(Being Profit on revaluation distributed and transferred to Capital accounts)
2018 April 1	Bank A/c Dr.		75,000
	To Rohan's Capital A/c			50,000
	To Rohit's Capital A/c			25,000
	(Being additional capital brought by partners)
2018 April 1	Sachin’s Capital A/c Dr.		65,500
	To Sachin’s Loan A/c			65,500
	(Being balance of Sachin’s Capital A/c transferred to Sachin’s Loan A/c)
			3,10,500	3,10,500

Working Notes :

(1) Calculation of Profit on revaluation of Assets and Liabilities.

Dr	Revaluation Account					Cr
Particulars			Amount (₹)	Particulars	Amount (₹)
To Debtors A/c			10,000	By Building A/c	50,000
To Live Stock A/c			5,000	By Creditors A/c	10,000
To Plant and Machinery A/c			5,000
To Motor Truck A/c			5,000
To Goodwill A/c			7,500
To Partners’ Capital A/cs: Profit
Rohan		16,500
Rohit		5,500
Sachin		55,500	27,500
			60,000		60,000

Dr	Partners’ Capital Accounts								Cr
Particulars		Rohan (₹)	Rohit (₹)	Sachin (₹)	Particulars	Rohan (₹)	Rohit (₹)	Sachin (₹)
To Loan A/c		-	-	65,500	By Balance b/d	1,25,000	1,00,000	50,000
To Balance c/d		2,21,500	1,40,500	-	By General reserve A/c	30,000	10,000	10,000
					By revaluation A/c (Profit)	16,500	5,500	5,500
					By Bank A/c	50,000	25,000	-
		2,21,500	1,40,500	65,500		2,21,500	1,40,500	65,500

Balbharati Solutions for Book-keeping and Accountancy 12th Standard HSC Maharashtra State Board.

Chapter 4: Reconstitution of Partnership

(Retirement of Partner)

EXERCISE - 4 [PAGE 182]

Select the most appropriate alternative from those given below and rewrite the sentence

Write the Word/ Term/ Phrase which can substitute of the following statement

State whether the following statement is true or false with reasons

Fill in the blank and rewrite the following sentence

Answer the following.

PRACTICAL PROBLEMS [PAGES 183 - 186]

Balbharati solutions for Book-keeping and Accountancy 12th Standard Hsc Maharashtra State Board Chapter 4 Reconstitution of Partnership (Retirement of Partner) Practical Problems [Pages 183 - 186]

Chapter 1: Introduction to Partnership and Partnership Final Accounts

Chapter 2: Accounts of ‘Not for Profit’ Concerns

Chapter 3: Reconstitution of Partnership (Admission of Partner)

Chapter 4: Reconstitution of Partnership (Retirement of Partner)

Chapter 5: Reconstitution of Partnership (Death of Partner)

Chapter 6: Dissolution of Partnership Firm

Chapter 7: Bills of Exchange

Chapter 8: Company Accounts - Issue of Shares

Chapter 9: Analysis of Financial Statements

Chapter 10: Computer In Accounting

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