Practical Problem 06

Practical Problems | Q 6 | Page 164

Vrushali and Leena are equal partners in the business.

Their Balance sheet as on 31 March 2018 stood as under.

                                                                                             Balance Sheet as on 31st March,2018 .

Liabilities

Rs

Rs

Asset

Rs

Rs

Sundry Creditors

 

90,000

Cash in Bank

 

62,000

Capitals :

  

Debtors

31,000

 

Vrushali

45,000

 

Less: R.D.D

-1,000

30,000

Leena

30,000

75,000

Building

 

55,000

General Reserves

 

18,000

Machinery

 

24,000

   

Bills Receivable

 

12,000

  

1,83,000

 

 

1,83,000

They decided to admit Aparna on 1st April 2018 on the following terms:

1. The Machinery and Building be depreciated by 10%. Reserve for Doubtful Debts to be increased by ` 5,000

2. Bills Receivable are taken over by Vrushali at the discount of 10%

3. Aparna should bring ` 60,000 as capital for her 1/4 th share in future profits.

4. The capital accounts of all the partners be adjusted in proportion in the new profit sharing ratio by opening

current accounts of the partners.

Prepare Profit and Loss Adjustment A/c, Partner’s capital A/c, Balance sheet of new firm.

                                                                                                          IN THE BOOKS OF NEW FIRM

Dr                                                                                                   Profit and Loss Adjustment Account                                                                                                       Cr

Particular

Amt

Amt

Particular

Amt

Amt

To Building

 

5,500

   

To Machinery

 

2,400

   

To Debtors

 

5,000

   

To Bill Receivable

 

1,200

   
   

By Loss on Revaluation.

  
   

Vrushali Capital A/c

7,050

 
   

Leena Capital A/c

7,050

14,100

  

14,100

  

14,100

Dr                                                                                                                            Partners Capital Account                                                                                               Cr

Particular

Vrushali

Leena

Aparna

Particular

Vrushali

Leena

Aparna

To Bill Rec. A/c

10,800

  

By Bal b/d

45,000

30,000

 

To P & L Adj A/c

7,050

7,050

 

By Gen Res A/c

9,000

9,000

 

To Bal c/d

90,000

90,000

60,000

By Cash A/c

  

60,000

    

By Current A/c

53,850

58,050

 
 

1,07,850

97,050

60,000

 

1,07,850

97,050

60,000

                                                                                                       Balance sheet of New Firm as on 1st April….

Liabilities

Amt

Amt

Asset

 

Amt

Capital A/c

  

Building

55,000

 

Vrushali

90,000

 

Less: [email protected] 10%

-5,500

49,500

Leena

90,000

 

Machinery

24,000

 

Aparna

60,000

2,40,000

Less: [email protected] 10%

-2,400

21,600

Sundry Creditors

 

90,000

Debtor

31,000

 
   

Less: RDD

-6,000

25,000

   

Bill Receivable

12,000

 
   

Less: Discount @ 10%

-1,200

 
    

10,800

 
   

Less: Vrushali Capital A/c

-10,800

0

   

Vrushali Current A/c

 

53,850

   

Leena Current A/c

 

58,050

   

Cash

 

1,22,000

  

3,30,000

  

3,30,000

Dr                                                                                                                                         Cash A/c                                                                                                                             Cr

Particular

Amt

Amt

Particular

Amt

Amt

To bal B/d

 

62,000

   

To Arpana Capital A/c

 

60,000

By Bal c/d

 

1,22,000

  

1,22,000

  

1,22,000