Question

14. Sunil Jobins and Manish were partners in a firm sharing profits in the ratio of 2:2:1. On 31st March
2019, their Balance Sheet was as follows:
Liabilities
Assets
3
1,62,500
40,000
27,500
Creditors
Workmen Compensation Reserve
General Reserve
Capital Alcs
Sunil
Jobins
Manish
Bank
Stock
Debtors
Land and Building
Profit and Loss Alc
190,000
70,000
40,000
5,00.000
1,60,000
3,00,000
3,00,000
1,30,000
7,30,000
9,60,000
9,60,000
Jobins died on 30th June, 2019. Partnership Deed provided for the following on death of a partner:
(1) Goodwill of the firm was to be valued at 2 years' purchase of the average profit of last 5 years. The
profits for the past four years were * 80,000; 1,00,000; * 1,50,000 and 1,30,000 respectively.
(ii) Share of profit or loss till the date of his death was to be calculated on the basis of the profit
or loss for the year ended 31st March, 2019.
tiii) Sunil and Manish decide to record the effect of Workmen Compensation Reserve and General
Reserve without affecting their book values.
Prepare Jobins's Capital Account at the time of his death to be presented to his executor.​

Answer 1

Answer:

14. Sunil Jobins and Manish were partners in a firm sharing profits in the ratio of 2:2:1. On 31st March

2019, their Balance Sheet was as follows:

Liabilities

Assets

3

1,62,500

40,000

27,500

Creditors

Workmen Compensation Reserve

General Reserve

Capital Alcs

Sunil

Jobins

Manish

Bank

Stock

Debtors

Land and Building

Profit and Loss Alc

190,000

70,000

40,000