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Syllabus
Q12. Kavita, Meenakshi and Gauri are partners doing a paper business in Ludhiana. After the accounts of partnership have been drawn up and closed, it was discovered that for the year ending 31stMarch 2013 and 2014. Interest on capital has been allowed to partners @ 6% p.a although there is no provision for interest on capital in partnership deed. Their fixed capitals were Rs. 2,00,000; Rs. 1.60,000 and Rs. 1,20,000 respectively. During the last years they had shared the profit as under:
Year Ratio
31 March 2013 3 : 2 : 1
31 March 2014 5 : 3 : 2
You are requied to given necessary adjusting entry on April 1, 2014.
i profirand loss account rs 24,000
ii advertisements suspense account rs12,000
pass necessary adjutmententry .
if in any ques it is mentioned that ithout affecting their boo value, so do we have to ditribute profit n loss in sacrificing ratio in uch ques ?
Profit for last 4 years:
2015 80,000
2016 1,45,000
2017 1,60,000
2018 2,00,000
1) abnormal loss of ?20,000 was debit to p&l a/c for the year ended 31st March 2015.
2) A fixed assets was sold in the year ended 31st March 2016 & gain ( profit) of ?25,000 was credited to p&l a/c.
3) In the year ended 31st March 2016 assets of the firm were not insured due to oversight. Insurance premium not paid was ?15,000.
Q17. Surya Ltd. with a registered capital of 10,00,000 equity shares of Rs.10 each, issued 1,00,000 equity shares payable Rs.3 on application, Rs.2 on allotment, Rs. 3 on first call Rs. 2 on second and final call. The amount due on allotment was duly received except Mr. X holding 6,000 shares. His shares were immediately forfeited. On the first call being made, Mr. Y holding 5,000 equity shares paid the entire balance on his holding. Second call was not made.
Pass the necessary journal entries to record and transactions and show how the share capital will be resented in the balance sheet of the company. Also prepare notes to accounts.
Pass the journal entry giving effect to the above.
In most of the sample papers of accountancy,some adjustments are being given for goodwill such as-
"Pass entries assuming that the partners do not want g/w to appear in the b/s."
"Goodwill was raised at its full value"
What will be the treatment for these ? Is it being given just to cnfse the students /there is some significance of it? kindly reply.
invetment fluctuation reserve 54,000
investment (at cost) 6,00,000
show the accounting treatment if the market value of investments is 5,91,000
(i) Goodwill is valued at three years purchase of the average profits of the last four years . Profit of the last four years were as : year 2009 --- Rs. 40,000, year 2010 --- Rs. 58,000, year 2011 --- Rs. 53,000, year 2012 --- Rs. 62,000.
(ii) Abnormal loss of Rs. 2000 due to theft has reduced the profits of the year 2009.
(iii) Profits for the year 2010 include abnormal profit of Rs. 4,000.
(iv) A speculative and lottery profit of Rs. 5,000 was received during the year 2011 which was included in that year's profit.
(v) Profits of the year 2012 were reduced by Rs. 10,000 on such a machinery which was destroyed by fire during the year.
P:S please respond as fast as possible !
1998 40000
1999 10000 loss
2000 80000 loss
2001 120000
2002 140000
reserve and profit appeared in the balance sheet at 40000 and 30000 respectively .partner neither want to show goodwill in the books nor want to distribute the reserve and profit appearing in the balance sheet .pass a single journal entry to record the change
This is a question in one of the chapter tests. Can you please explain how to do it step by step. Also the answer of Q7 in the same test is marked wrong. --
Use the following information to answer the next question.
P, Q and R were partners in a firm sharing profits and losses in the ratio of 2:2:1. With effect from 1st April, they decided to share profits and losses equally. On this date, the following balances appear in Balance Sheet.
Taxation Reserve Rs 30,000; General Reserve Rs 12,000; Advertisement Suspense A/c Rs 25,000.
Goodwill at the time of reconstitution was valued at Rs 49,000.
However, partners decided to show the values at unaltered figures in the Reconstituted Balance Sheet.
Which of the following Journal entries can be passed as a single adjustment entry to show the net effect.
P’s Capital A/c Dr. 1,200
Q’s Capital A/c Dr. 1,200
To R's Capital A/c 2,400
R's Capital A/c Dr. 8,800
To P’s Capital A/c 4,400
To Q’s Capital A/c 4,400
R's Capital A/c Dr. 2,400
To P’s Capital A/c 1,200
To Q’s Capital A/c 1,200
P’s Capital A/c Dr. 4,400
Q’s Capital A/c Dr. 4,400
To R's Capital A/c 8,800
Priya and Riya were partners in a firm sharing profits in the ratio of 3:1.On 1st April 2015 they admitted Siya As new partner for 1/4th share in the profits of the firm.On the date of Siya's admission the balance sheet of Priya and Riya showed a General Reserve of Rs 80000, a debit balance of Rs 40000 in Profit and Loss A/c and Workmen Compensation Fund of Rs20000.
The following was agreed on Siya's admission.
i) Siya will bring Rs200,00 as her capital and the necessary amount of cash as premium for his share of goodwill.
ii) Goodwill of the firm is valued at Rs 80000.
iii) There was acclaim of Workmen compensation for Rs28000.
iv) The partners decided to share future profits in the ratio of 2:1:1.
Pass the necessary journal entries for the above on Siya's admission.
Bhavya and Naman were partners in a film carrying on a tiffin service in Hyderabad. Bhavya noticed that a lot of food is left at the end of the day. To avoid wastage she suggested that it be distributed to the needy; Naman wanted that it should be mixed with the food being served the next day. Naman then gave a proposal that if his share in the profit is increased, he will not mind free distribution of left over food. Bhavya happily agreed. So, they decided to change their profit sharing ratio to 1 : 2 with immediate effect. On that date revaluation of assets and reassessment of liabilities was carried out that resulted into a gain of Rs. 18,000. On that date the goodwill of the film was valued at Rs. 1,20,000.
(a) Pass necessary journal entries for the above in the books of the firm.
(b) State any two values highlighted in the above Parap
2. Can there be a situationwhere the gaining partner cannot pay the sacrificing partner?
for e.g: A gets -1/4 and B gets 1/3, where the revaluated amount is Rs. 12,000. So, A would have to compensate B with Rs. 4,000.
How will he compensate if A's share is 1/4 x 12,000 = Rs. 3,000? Is this even possible?