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Accountancy · 2024 · 6 marks
Reconstitution of a Partnership Firm – Admission of a PartnerRevaluation of Assets and Reassessment of Liabilities6 markslong answer
CBSE 2024 · Region 3 · Set 1 · Q26
Sarah and Varsha were partners in a firm sharing profits and losses in the ratio of 3: 2. Their Balance Sheet as at 31st March, 2023 was as follows:…
Sarah and Varsha were partners in a firm sharing profits and losses in the ratio of $\displaystyle 3$ : 2. Their Balance Sheet as at 31st March, $\displaystyle 2023$ was as follows :
Balance Sheet of Sarah and Varsha as at 31st March, $\displaystyle 2023$
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| Capital : | Plant and Machinery | $\displaystyle 2,00,000$ | |
| Sarah $\displaystyle 60,000$ | Stock | $\displaystyle 30,000$ | |
| Varsha $\displaystyle 50,000$ | $\displaystyle 1,10,000$ | Debtors $\displaystyle 50,000$ | |
| Workmen's Compensation Fund | $\displaystyle 20,000$ | Less : Provision for doubtful debts $\displaystyle 5,000$ | $\displaystyle 45,000$ |
| Provident Fund | $\displaystyle 1,20,000$ | Cash | $\displaystyle 25,000$ |
| Creditors | $\displaystyle 50,000$ | ||
| $\displaystyle 3,00,000$ | $\displaystyle 3,00,000$ |
On 1st April, $\displaystyle 2023$, they decided to admit Tasha as a new partner 1th for share in the profits of the firm on the following terms : $\displaystyle 4$ (i) Tasha brought ₹ $\displaystyle 40,000$ as her capital and ₹ $\displaystyle 20,000$ as her share of premium for goodwill. (ii) Plant and Machinery was valued at ₹ $\displaystyle 1,90$,000. (iii) An item of ₹ $\displaystyle 20,000$, included in creditors, is not likely to be claimed and should be written off. (iv) Capitals of the partners in the new firm are to be in the new profit shar ing ratio on the basis of Tasha' s capital, by bringing or paying off cash, as the case may be. Prepare Revaluation Account and P artners' Capital Accounts.
Inder, Jonny and Kapil were partners in a firm sharing profits and losses in the ratio of $\displaystyle 9$ : $\displaystyle 3$ : $\displaystyle 4$ . Their Balance Sheet as at 31st March, $\displaystyle 2023$ was as follows :
Balance Sheet of Inder, Jonny and Kapil as at 31st March, $\displaystyle 2023$
| Liabilities | Amount (₹) | Assets | Amount (₹) |
| Capital : | Fixed Assets | $\displaystyle 1,20,000$ | |
| Inder $\displaystyle 90,000$ | Stock | $\displaystyle 60,000$ | |
| Jonny $\displaystyle 75,000$ | Debtors | $\displaystyle 1,00,000$ | |
| Kapil $\displaystyle 60,000$ | $\displaystyle 2,25,000$ | Cash | $\displaystyle 35,000$ |
| General Reserve | $\displaystyle 80,000$ | ||
| Creditors | $\displaystyle 10,000$ | ||
| $\displaystyle 3,15,000$ | $\displaystyle 3,15,000$ |
Kapil retired from the firm on 31st March, $\displaystyle 2023$ on the following terms : (i) Bad Debts amounting to ₹ $\displaystyle 5,000$ were to be written off. (ii) Fixed Assets were revalued at ₹ $\displaystyle 96$,000. (iii) Stock was undervalued by ₹ $\displaystyle 29$,000. (iv) Creditors were paid off. (v) Goodwill of the firm was valued at ₹ $\displaystyle 80,000$ and Kapil's share of goodwill was to be adjusted in the accounts of Inder and Jonny. (vi) New profit sharing ratio between Inder and Jonny was $\displaystyle 3$ : 2. Pass the necessary journal entries in the books of the firm on Kapil retirement. 's
Marking-scheme solution
Dr. Revaluation Account Cr.
Particulars Amount ( ₹) Particulars Amount ( ₹)
To Plant & Machinery $\displaystyle 10,000$ By Creditors $\displaystyle 20,000$
To Profit t/f to Capital
Accounts
Sarah $\displaystyle 6,000$
Varsha $\displaystyle 4,000$ $\displaystyle 10,000$
$\displaystyle 20,000$ $\displaystyle 20,000$
Dr. Partners’ Capital Accounts Cr.
Particulars Sarah Varsha Tasha Particulars Sarah Varsha Tasha
( ₹) ( ₹) ( ₹) ( ₹) ( ₹) ( ₹)
To Cash A/c $\displaystyle 18,000$ $\displaystyle 22,000$ - By balance b/d $\displaystyle 60,000$ $\displaystyle 50,000$ -
(1)
By Workmen
Compensation
Fund A/c $\displaystyle 12,000$ $\displaystyle 8,000$ -
By Cash A/c - - $\displaystyle 40,000$
By Premium for
Goodwill A/c $\displaystyle 12,000$ $\displaystyle 8,000$ -
To balance c/d $\displaystyle 72,000$ $\displaystyle 48,000$ $\displaystyle 40,000$ By Revaluation
(1)
A/c $\displaystyle 6,000$ $\displaystyle 4,000$ -
$\displaystyle 90,000$ $\displaystyle 70,000$ $\displaystyle 40,000$ $\displaystyle 90,000$ $\displaystyle 70,000$ $\displaystyle 40,000$
Q. Inder, Jonny and Kapil were partners ……………………….
Ans:
Books of Inder, Jonny and Kapil
JOURNAL
Date Particulars L.F. Dr. Cr.
Amount ( ₹) Amount ( ₹)
$\displaystyle 2023$ General Reserve A/c Dr. $\displaystyle 80,000$
March $\displaystyle 31$ To Inder’s Capital A/c $\displaystyle 45,000$
To Jonny’s Capital A/c $\displaystyle 15,000$
To Kapil’s Capital A/c $\displaystyle 20,000$
(General reserve distributed among
old partners in old ratio.)
“ Bad Debts A/c Dr. $\displaystyle 5,000$
To Debtors A/c $\displaystyle 5,000$
(Bad debts written off.)
” Revaluation A/c Dr. $\displaystyle 5,000$
To Bad Debts A/c $\displaystyle 5,000$
(Bad debts transferred to Revaluation
account.)
” Stock A/c Dr. $\displaystyle 29,000$
To Revaluation A/c $\displaystyle 29,000$
(Value of stock increased by ₹$\displaystyle 12$,000.)
” Revaluation A/c Dr. $\displaystyle 24,000$
To Fixed Asset A/c $\displaystyle 24,000$
(Fixed assets reduced by ₹$\displaystyle 24$,000.)
” Creditors A/c Dr. $\displaystyle 10,000$
To Cash A/c $\displaystyle 10,000$
(Creditors paid off.)
” Inder’s Capital A/c Dr. $\displaystyle 3,000$
Jonny’s Capital A/c Dr. $\displaystyle 17,000$
To Kapil’s Capital A/c $\displaystyle 20,000$
(Goodwill adjusted on retirement.)
” Kapil’s Capital A/c Dr. $\displaystyle 1,00,000$
To Kapil’s Loan A/c $\displaystyle 1,00,000$
(Kapil’s final balance in capital
transferred to his loan account.)
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CBSE Class 12 Accountancy past-paper question from the 2024 board exam, with the answer as CBSE’s own marking scheme gives it. Where our answers come from.