✓ Board-verified
Accountancy · 2023 · 6 marks
Reconstitution of a Partnership Firm – Admission of a PartnerRevaluation of Assets and Reassessment of Liabilities6 markslong answer
CBSE 2023 · Region 3 · Set 1 · Q24
On 31st March, 2022 the Balance Sheet of partners A and B, who were sharing profits in the ratio of 3: 2 was as follows: Balance Sheet of A and B as…
On 31st March, $\displaystyle 2022$ the Balance Sheet of partners A and B, who were sharing profits in the ratio of $\displaystyle 3$ : $\displaystyle 2$ was as follows :
Balance Sheet of A and B as at 31st March, $\displaystyle 2022$
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| Creditors | $\displaystyle 30,000$ | Cash at Bank | $\displaystyle 20,000$ |
| Investment Fluctuation Fund | $\displaystyle 12,000$ | Debtors $\displaystyle 85,000$ | |
| General Reserve | $\displaystyle 25,000$ | Less provision $\displaystyle 5,000$ | $\displaystyle 80,000$ |
| Capitals : | Stock | $\displaystyle 1,30,000$ | |
| A $\displaystyle 1,60,000$ | Investments | $\displaystyle 60,000$ | |
| B $\displaystyle 1,40,000$ | $\displaystyle 3,00,000$ | Furniture | $\displaystyle 77,000$ |
| $\displaystyle 3,67,000$ | $\displaystyle 3,67,000$ |
$\displaystyle 1$ On 1st April $\displaystyle 2022$, they decided to admit C as a new partner for $\displaystyle 5$ share in the profits on the following terms : (i) C brought ₹ $\displaystyle 1,00,000$ as his Capital and ₹ $\displaystyle 50,000$ as his share of Premium for Goodwill. (ii) One month salary ₹ $\displaystyle 2,000$ was outstanding. (iii) The market value of investments was ₹ $\displaystyle 50$,000. (iv) A debtor, whose dues were written off as bad debts, paid ₹ $\displaystyle 12,000$ in full settlement. Prepare Revaluation Account and Partners Capital Accounts.
Anita, Geeta and Sita were partners in a firm sharing profits and losses in the ratio of $\displaystyle 2$ : $\displaystyle 2$ : 1. Their Balance Sheet as at 31st March, $\displaystyle 2022$ was as follow :
Balance Sheet of Anita, Geeta and Sita as at 31st March, $\displaystyle 2022$
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| Capitals : | Land and Building | $\displaystyle 4,80,000$ | |
| Anita $\displaystyle 2,00,000$ | Investments | $\displaystyle 1,20,000$ | |
| Geeta $\displaystyle 2,00,000$ | Debtors $\displaystyle 1,50,000$ | ||
| Sita $\displaystyle 1,00,000$ | $\displaystyle 5,00,000$ | Less Provision $\displaystyle 10,000$ | $\displaystyle 1,40,000$ |
| General Reserve | $\displaystyle 30,000$ | Stock | $\displaystyle 1,20,000$ |
| Creditors | $\displaystyle 5,00,000$ | Cash at Bank | $\displaystyle 1,70,000$ |
| $\displaystyle 10,30,000$ | $\displaystyle 10,30,000$ |
On the above date, Anita retired from the firm and the remaining partners decided to carry on the business. It was agreed to revalue the assets and reassess the liabilities as follows : (i) Goodwill of the firm was valued at ₹ $\displaystyle 3,00$,000. (ii) Land and Building was to be appreciated by ₹ $\displaystyle 1,23$,000. (iii) Bad debts amounted to ₹ $\displaystyle 20$,000. A provision for doubtful debts was to be maintained at $\displaystyle 10$% on debtors. (iv) Anita was paid ₹ $\displaystyle 80,000$ immediately by cheque. The balance amount was transferred to her loan account which was to be paid in two equal annual instalments along with interest @ $\displaystyle 10$% p.a. Prepare Revaluation Account and Partners' Capital Accounts on Anita's retirement.
Marking-scheme solution
Dr. REVALUATION A/c Cr.
Particulars Amount Particulars Amount
₹ ₹
To Outstanding Salaries A/c $\displaystyle 2,000$ By Bad Debts
Recovered A/c
$\displaystyle 12,000$
To Profit on Revaluation
transferred to Partners’
Capital A/c $\displaystyle 10,000$
A – $\displaystyle 6,000$
B – $\displaystyle 4,000$
$\displaystyle 12,000$ $\displaystyle 12,000$
Dr. PARTNERS’ CAPITAL A/c Cr.
Particulars A B C Particulars A B C
₹ ₹ ₹ ₹ ₹ ₹
To Bal c/d $\displaystyle 2,12,200$ $\displaystyle 1,74,800$ $\displaystyle 1,00,000$ By Bal b/d $\displaystyle 1,60,000$ $\displaystyle 1,40,000$ -
By General
ReserveA/c $\displaystyle 15,000$ $\displaystyle 10,000$ -
By Investment
Fluctuation
Fund A/c $\displaystyle 1,200$ $\displaystyle 800$ -
By Premium
for Goodwill
$\displaystyle 30,000$ $\displaystyle 20,000$ -
A/c
By
$\displaystyle 6,000$ $\displaystyle 4,000$ -
Revaluation
A/c
By Bank A/c
- $\displaystyle 1,00,000$
$\displaystyle 2,12,200$ $\displaystyle 1,74,800$ $\displaystyle 1,00,000$ $\displaystyle 2,12,200$ $\displaystyle 1,74,800$ $\displaystyle 1,00,000$
Q. Anita, Geeta and Sita were partners in a firm…..
Ans.
Dr. REVALUATION A/c Cr.
Particulars Amount Particulars Amount
₹ ₹
To Bad Debts A/c $\displaystyle 10,000$ By Land & Building $\displaystyle 1,23,000$
A/c
To Provision for Doubtful
Debts A/c $\displaystyle 13,000$
To Profit transferred to
Partners Capital A/c’s:
Anita- $\displaystyle 40,000$
Geeta- $\displaystyle 40,000$ $\displaystyle 1,00,000$
Sita- $\displaystyle 20,000$
$\displaystyle 1,23,000$ $\displaystyle 1,23,000$
Dr. PARTNERS’ CAPITAL A/c Cr.
Particulars Anita Geeta Sita Particulars Anita Geeta Sita
₹ ₹ ₹ ₹ ₹ ₹
To - $\displaystyle 80,000$ $\displaystyle 40,000$ By Bal $\displaystyle 2,00,000$ $\displaystyle 2,00,000$ $\displaystyle 1,00,000$
Anita’s b/d
Capital A/c
By
To Bank $\displaystyle 80,000$ - - General $\displaystyle 12,000$ $\displaystyle 12,000$ $\displaystyle 6,000$
A/c Reserve
A/c
To
Anita’s $\displaystyle 2,92,000$ - - By
Loan A/c Geeta’s $\displaystyle 80,000$ - -
Capital
A/c
To Bal - $\displaystyle 1,72,000$ $\displaystyle 86,000$
c/d By Sita’s
Capital $\displaystyle 40,000$ - -
A/c
By
Revaluation $\displaystyle 40,000$ $\displaystyle 40,000$ $\displaystyle 20,000$
A/c
$\displaystyle 3,72,000$ $\displaystyle 2,52,000$ $\displaystyle 1,26,000$ $\displaystyle 3,72,000$ $\displaystyle 2,52,000$ $\displaystyle 1,26,000$
All Reconstitution of a Partnership Firm – Admission of a Partner questions2023 question paperPractice Reconstitution of a Partnership Firm – Admission of a Partner →
More from Reconstitution of a Partnership Firm – Admission of a Partner
- Asha and Indra were partners in a firm sharing profits and losses in the ratio of 3: 2. Their Balance Sheet on 31st March, 2025 was as following:…2026
- Devki and Neena were partners in a firm sharing profits and losses in the ratio of 4:3. Amar was admitted as a new partner for 1/5 h share in the…2026
- Alex, Benn and Cole were partners in a firm sharing profits and losses in 1th the ratio of 5: 3: 2. They admitted Dona as a new partner for share 5…2024
- Sanjay and Vijay were partners in a firm sharing profits and losses in the ratio of 4: 3. On 1st April, 2025 they admitted Babul as a new nth...,..…2026
- The goodwill of a firm was valued on the basis of 3 years purchase of average profits for the last four years. The profits of last four years ending…2023
- Mansi and Uma were partners in a firm and their capitals were 4,00,000 and ₹ 2,00,000 respectively. Normal rate of return in a similar business was…2026
- Atul, Beena and Sita were partners in a firm sharing profits and losses in the ratio of 8: 7: 5. Damini was admitted as a new 1th partner for share…2024
- Bhawana and Vedika were partners in a firm sharing profits and losses in the ratio of 5: 4. From 1st April, 2024 they decided to share future profits…2025
CBSE Class 12 Accountancy past-paper question from the 2023 board exam, with the answer as CBSE’s own marking scheme gives it. Where our answers come from.