Ram, Shyam and Mohan were in partnership sharing profits and losses in the proportions of 3 : 2 : 1. On 1st April, 2011, Shyam retires from the firm. On that date, their Balance Sheet was as follows :

$\begin{matrix} Capital and Liabilities & Rs & Assets & Rs Trade Creditors & 30, 000 & Cash in hand & 90, 000 Bills Payable & 27, 000 & Debtors & 1, 60, 000 Expenses owing & 45, 000 & Less : Provision & 10, 000 - ------ - & 1, 50, 000 Reserve Fund & 1, 05, 000 & Stock & 1, 20, 000 Workmen's Compensation & Factory Premises & 2, 25, 000 Reserve & 48, 000 & Investments & 80, 000 Capitals : & Loose Tools & 40, 000 Ram & 2, 00, 000 Shyam & 1, 50, 000 Mohan & 1, 00, 000 - -------- - & 4, 50, 000 - -------- - 7, 05, 000 - -------- - - -------- - & ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 7, 05, 000 - -------- - - -------- - \end{matrix}$

The terms were:

(1) Goodwill of the firm to be valued at 2 times of Average Super Profits of last three years. Taking into consideration the risk of the business, normal profits of the firm are estimated at Rs 5,00,000 every year year. But actual profits of last three years ending 31st March were as 2009 : Rs 6,00,000, 2010 : Rs 5,50,000, 2011 : Rs 5,75,000.

(2) Expenses owing to be brought down to Rs 37,500.

(3) Investments are revalued at Rs 72,000. Ram took over investments at this value.

(4) Factory premises is to be revalued at Rs 2,43,000; and Loose tools at Rs 36,000.

(5) Provision for doubtful Debts to be increased by Rs 19,500.

(6) Claim on account of Workmen's Compensation is Rs 18,000.

(7) Shyam be paid Rs 50,000 in cash and balance due to him treated as a loan carrying interest @ 6% per annum.

Show Journal entry for goodwill adjustment, prepare necessary ledger accounts and opening balance sheet of the continuing partners.

Radha, Sheela and Meena were in partnership sharing profits and losses in the proportion of 3:2:1. On April 1, 2017, Sheela retires from the firm. On that date, their Balance Sheet was as follows:

Liabilities		Amount Rs	Assets	Amount Rs
Trade Creditors		3,000	Cash-in-Hand	1,500
Bills Payable		4,500	Cash at Bank	7,500
Expenses Owing		4,500	Debtors	15,000
General Reserve		13,500	Stock	12,000
Capitals:			Factory Premises	22,500
Radha	15,000		Machinery	8,000
Sheela	15,000		Losse Tools	4,000
Meena	15,000	45,000
		70,500		70,500

The terms were:

a) Goodwill of the firm was valued at Rs 13,500.

b) Expenses owing to be brought down to Rs 3,750.

c) Machinery and Loose Tools are to be valued at 10% less than their book value.

d) Factory premises are to be revalued at Rs 24,300.

Prepare:

1. Revaluation account

2. Partner’s capital accounts and

3. Balance sheet of the firm after retirement of Sheela.

Q. Assets in the beginning of the year Rs. 10,000. Assets at the end of the year Rs. 18,000. Drawing during the year Rs. 2,000. Therefore the profit is equal to ___________.

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The correct option is C Rs. 16,000Opening stock = 20000,Purchase - 10000 and sale 2000=20000+10000-2000 = 28000closing balance - 12000 so, value is reduced from 28000 to 12000, so it means 16000 is depreciation here.

The correct option is C Rs. 16,000
Opening stock = 20000,Purchase - 10000 and sale 2000
=20000+10000-2000 = 28000
closing balance - 12000
so, value is reduced from 28000 to 12000, so it means 16000 is depreciation here.