Ram, Shyam and Bharat were partners sharing profits and losses in the ration of 2:3:3 respectively. Their Balance Sheet on 31st March, 2012 was as follows.

12. Ram, Shyam and Bharat were partners sharing profits and losses in the ration of 2:3:3 respectively. Their Balance Sheet on 31st March, 2012 was as follows.


Balance Sheet as on 31st March, 2012


Liabilities
Rs.
Rs.
Assets
Rs.
Rs.
Bills Payable

10000
Cash in Hand

500
Trade Creditors

30000
Cash at Bank

22000
Loan from 'Usha'

20000
Bills Receivable

4500
General Reserve

16000
Trade Debtors

60000
Capital Account:


Stock in Trade

35000
Ram
20000

Furniture

2000
Shyam
27000

Building

29000
Bharat
30000
77000





153000


153000


On 1st April, 2012 they admitted Laxman into prtnership for ¼ th share on the following terms.


(i) Laxman should bring Rs. 25,000 as capital.

(ii) A goodwill account be opened in the books for Rs. 40,000 and the old partners be credited in their profit sharing ratio.

(iii) The value of stock in trade be reduced by 10%.

(iv) Building be appreciated by 15%.

(v) A provision for Bad Debts of Rs. 4000 be made.

(vi) An item of Rs. 502 included in Trade Creditors is not likely to be claimed and hence should be written off.

(vii) There being a claim for damages against the firm, a liability to the extent of Rs. 1000 should be created.

(viii) After Laxman's Admission in the firm Goodwill account should be written off.


Prepare (a) Profit and Loss Adjustment Account. (b) Balance Sheet of the new firm.


Ans.

Profit and loss adjustment a/c
Profit. Rs. 3648
Balance sheet total
174850
Bank A/c Bal
47000
Capital A/c

Ram
25588
Shyam
35382
Bharat
38382
Laxman
15000

1 comment: