12th Class
Accountancy
Sample Paper
Accountancy - Sample Paper-10
question_answer
Vishvesh and Yogesh are partners in a firm. They share profits and losses in the ratio of 3 : 2. Their balance sheet as at 3lst March, 2017 was as under: Balance Sheet as at 31st March, 2017
Liabilities
Amt (Rs.)
Assets
Amt (Rs.)
Creditors
1,50,000
Cash at Bank
1,20,000
Bills Payable
80,000
Debtors
2,00,000
Outstanding Rent
20,000
(-) Provision for Doubtful Debts
(20,000)
1,80,000
Capital A/cs
Stock
50,000
Vishvesh
3,00,000
Plant and Machinery
3,40,000
Yogesh
1,50,000
4,50,000
Prepaid Expenses
10,000
7,00,000
7,00,000
They admitted Nishant as a new partner on 1st April, 2017 on the following terms:
(i) Nishant will bring in Rs. 2,00,000 as capital and the necessary amount for goodwill.
(ii) The new profit sharing ratio among Vishvesh, Yogesh and Nishant will be 5 : 3 : 2.
(iii) The amount of goodwill is to be based on Nishaot's share in profits and capital contributed by him.
(iv) Stock to be depreciated by 10%.
(v) A provision for doubtful debts is to be only Rs. 5,000.
(vi) Plant and machinery are to be depreciated by 5%.
Prepare the revaluation account, bank account, partners' capital accounts and the balance sheet of the new firm. Or A, B and C were in partnership sharing profits in proportion to their capitals. Their balance sheet on 3lst March, 2017 was as follows: Balance Sheet as at 31st March, 2017
Liabilities
Amt (Rs.)
Assets
Amt (Rs.)
Creditors
15,600
Cash
16,000
Reserve
6,000
Debtors
20,000
Capital A/cs
(-) Provision for Doubtful Debts
(400)
19,600
A
90,000
Stock
18,000
B
60,000
Machinery
48,000
C
30,000
1,80,000
Buildings
1,00,000
2,01,600
2,01,600
On the above date B retired owing to ill health and the following adjustments were agreed upon
(i) Buildings to be appreciated by 10%.
(ii) Provision for doubtful debts to be increased to 5% of debtors.
(iii) Machinery to be depreciated by 15%.
(iv) Goodwill of the firm be valued at Rs. 36,000 and be adjusted into the capital accounts of A and C who will share profits in future in the ratio of 3 : 1.
(v) A provision to be made for outstanding repairs bill of Rs. 3,000.
(vi) Included in the value of creditors is Rs. 1,800 for an outstanding legal claim, which is not likely to arise.
(vii) Out to the insurance premium paid Rs. 2,000 is for the next year. The amount was debited to profit and loss account.
(viii) The partners decide to fix the capital of the new firm as Rs. 1,20,000 in the profit sharing ratio.
(ix) B to be paid Rs. 9,000 in cash and balance to be transferred to his loan account.
Prepare the revaluation account, partners' capital account and the balance sheet of the new firm after B's retirement.
Answer:
Dr Revaluation Account Cr
Particulars
Amt (Rs.)
Particulars
Amt (Rs.)
To Stock A/c
5,000
By Provision for Doubtful
15,000
To Plant and Machinery A/c
17,000
Debts A/c
(Rs. 20,000 ? Rs. 5,000)
By Loss transferred to
Vishvesh's Capital A/c
4,200
Yogesh's Capital A/c
2,800
7,000
22,000
22,000
Dr Partners' Capital Accounts Cr
Particulars
Vishvesh (Rs.)
Yogesh (Rs.)
Nishant (Rs.)
Particulars
Vishvesh (Rs.)
Yogesh (Rs.)
Nishant (Rs.)
To Revaluation
By Balance b/d
3,00,000
1,50,000
-
A/c (Loss)
4,200
2,800
-
To Balance c/d
3,31,500
1,82,900
2,00,000
By Bank A.c
-
-
2,00,000
By Premium for
Goodwill A/c
35,700
35,700
-
3,35,700
1,85,700
2,00,000
3,35,700
1,85,700
2,00,000
Balance Sheet of the new firm as at 1st April, 2017
Liabilities
Amt (Rs.)
Assets
Amt (Rs.)
Bills Payable
80,000
Cash at Bank
3,91,400
Creditors
1,50,000
Stock (Rs. 50,000 ? Rs. 5,000)
45,000
Outstanding Rent
20,000
Debtors
2,00,000
Capital A/cs
(-) Provision for Doubtful Debts
(5,000)
1,95,000
Vishvesh
3,31,500
Prepaid Expenses
10,000
Yogesh
1,82,900
Plant and Machinery
3,40,000
Nishant
2,00,000
7,14,400
(-) Depreciation
(17,000)
3,23,000
9,64,400
9,64,400
Dr Bank Account Cr
Particulars
Amt (Rs.)
Particulars
Amt (Rs.)
To Balance b/d
1,20,000
By Balance c/d
3,91,400
To Nishant's Capital A/c
2,00,000
To Premium (Goodwill) A/c
71,400
3,91,400
3,91,400
Working Notes 1. Calculation of Sacrificing Ratio Sacrificing Ratio = Old Share - New Share Vishvesh \[=\frac{3}{5}-\frac{5}{10}=\frac{6-5}{10}=\frac{1}{10};\] Yogesh \[=\frac{2}{5}-\frac{3}{10}=\frac{4-3}{10}=\frac{1}{10}\] Sacrificing Ratio of Vishvesh and Yogesh \[=\frac{1}{10}:\frac{1}{10}\] or 1 : 1. 2. Calculation of Hidden Goodwill Nishant contributes Rs. 2,00,000 for \[\frac{2}{10}th\] share \[\therefore \]Total capital of the firm should be \[=Rs.\,2,00,000\times \frac{10}{2}=Rs.\,10,00,000\] But the actual total capital of Vishvesh, Yogesh (after adjustment of revaluation loss) and Nishant is [(Rs. 3,00,000 + Rs. 1,50,000 ? Rs. 7,000, i.e., loss on revaluation) + Rs. 2,00,000] = Rs. 6,43,000. Therefore, Hidden Goodwill = Rs. 10,00,000 ? Rs. 6,43;000 = Rs. 3,57,000. Nishant's share = 1/5th of Rs. 3,57,000 = Rs. 71,400. Or Dr Revaluation Account Cr
Particulars
Amt (Rs.)
Particulars
Amt (Rs.)
To Provision For Doubtful Debts A/c
600
By Building A/c
10,000
To Machinery A/c
7,200
By Creditors A/c
1,800
To Outstanding Repair A/c
3,000
By Prepaid Insurance A/c
2,000
To Profit Transferred to
A's Capital A/c
1,500
B's Capital A/c
1,000
C's Capital A/c
500
3,000
13,800
13,800
Dr Partners' Capital Accounts Cr
Particulars
A
B
C
Particulars
A
B
C
To B's Capital A/c
9,000
-
3,000
By Balance b/d
90,000
60,000
30,000
To Cash A/c
-
9,000
-
By Reserve A/c
3,000
2,000
1,000
To B's Loan A/c
-
66,000
-
By Revaluation A/c (Profit)
1,500
1,000
500
To Balance c/d
90,000
-
30,000
By A?s Capital A/c
-
9,000
-
By C's Capital A/c
-
3,000
-
By Cash A/c (Balancing figure)
4,500
-
1,500
99,000
75,000
33,000
99,000
75,000
33,000
Balance Sheet as at 31st March, 2017
Liabilities
Amt (Rs.)
Assets
Amt (Rs.)
Outstanding Repairs
3,000
Building
1,10,000
Creditors
13,800
Debtors
20,000
Capital A/cs
(-) Provision for Doubtful Debts
(1,000)
19,000
A
90,000
Machinery
40,800
C
30,000
1,20,000
Prepaid Insurance
2,000
B?s Loan A/c
66,000
Stock
18,000
Cash
13,000
2,02,800
2,02,800
Working Notes 1. Calculation of Gaining Ratio Old Ratio \[\Rightarrow \]3 : 2 : 1; New Ration \[\Rightarrow \]3 : 1 Gaining Ratio = New Share - Old Share A \[=\frac{3}{4}-\frac{3}{6}=\frac{9-6}{12}=\frac{3}{12}'\] C \[=\frac{1}{4}-\frac{1}{6}=\frac{3-2}{12}=\frac{1}{12}\] Gaining ratio = 3 : 1 2. Calculation of B's Share of Goodwill Firm's Goodwill = 36,000 B's Share of Goodwill \[=36,000\times \frac{2}{6}=Rs.\,12,000,\]to be contributed by A and C in their gaining ratio. i.e., 3 : 1 3. Dr Cash Account Cr
