25.
Und Tilld. Also pass necessary journal entry
Ul goodwill on Tina's admission considering that Tina did not bring her share of goodwill
premium in cash.
4
Pass necessary journal entries in the following cases on the dissolution of a partnership firm of partners
X, Y, A and B:
(i) Realization expenses of Rs.5,000 were to borne by X, a partner. However, it was paid by Y.
(ii) Investments costing Rs.25,000 (comprising 1000 shares), had been written off from the books
completely. These shares are valued at Rs. 20 each and were divided amongst the partners.
(iii) Y's loan of Rs.50,000 settled at Rs.48,000.
(iv) Machinery (book value Rs. 6,00,000) was given to creditor at a discount of 20%.
Ajay, Binod and Chandra entered into partnership on 1st April 2019 with
26.
4
Rs. 2
Answers
Explanation:
Anna and Bobby were partners sharing profit and losses in the ratio 5: 3. Their Capital
Accounts showed balances of ` 3,00,000 and ` 2,00,000 respectively as on April 1, 2018.
The partnership deed provided for interest on capital @ 10 % p.a. The firm earned a profit
of ` 45,000 for the year ended March 31, 2019.
Show the distribution of profit among the partners by preparing the necessary account.
Q2. Calculate interest on drawings of Mr. Siddhant, a partner in a firm @ 10 % p.a. for the year
ended March 31, 2019 in each of the following alternative cases:
(a) If he withdrew ` 6,000 in the beginning of every month.
(b) If his drawings during the year were ` 30,000.
If he withdraws ` 5,000 in the middle of each quarter.
Q3. X and Y were partners sharing profit and losses in the ratio 7: 3. Their Capital Accounts as
on April 1, 2018 stood at X - ` 5,00,000 and Y - ` 4,00,000. Partners were allowed interest
on capital @ 5 % p.a. Drawings of the partners during the year ended March 31, 2019 were
` 72,000 and ` 50,000 respectively. Profit for the year before allowing interest on capital and
salary to Y @ ` 5,000 per month was ` 8,00,000. 10 % of the net profit was to be set aside as
General Reserve.
Pass journal entries for appropriation of profit of the firm.
Q4. The Capital Accounts of A, B and C stood at ` 1,50,000, ` 5,50,000 and ` 11,00,000
respectively as on March 31, 2018. Profit amounting to ` 3,00,000 for the year 2017-18
was distributed in the ratio 4: 1: 1 after allowing interest on capital @ 10 % p.a. During the
year, each partner withdrew ` 50,000 p.m. in the beginning of each month. The partnership
deed was silent as to profit sharing ratio and interest on drawings but provided for interest on
capital @ 12 % p.a.
Pass necessary journal entry to rectify the above error. Show your workings clearly.
Q5. Karan and Varun were partners in a firm sharing profit and losses in the ratio 1: 2. Their fixed
capitals were ` 2,00,000 and ` 3,00,000 respectively. Kishore was admitted as a new partner for
1/4th share on April 1, 2016. He brought ` 2,00,000 as his capital which was to be kept
fixed like the capitals of Karan and Varun. Kishore acquired his share of profit from Varun only.
Calculate goodwill of the firm on Kishore’s admission and the new profit-sharing ratio of
Karan, Varun and Kishore. Also, pass necessary journal entry for the treatment of goodwill on
Kishore’s admission considering that he did not bring his share of goodwill in cash.
Q6. W and R were partners in a partnership firm sharing profit and losses in the ratio 3: 2.
Their Balance Sheet as at March 31, 2016 was as follows:
Liabilities ` Assets `
Sundry Creditors
Prov. for bad debts
Outstanding Salary
General Reserve
Capitals:
W 60,000
R 40,000
20,000
2,000
3,000
5,000
1,00,000
Cash
Debtors
Stock
Furniture
Plant & Machinery
12,000
18,000
20,000
40,000
40,000
1,30,000 1,30,000
C was admitted on the above date for 1/6th share in profits on the following terms: