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Standard XII

Accountancy

Revaluation of Assets (Retirement)

Mitali, Indu ...

Question

Mitali, Indu and Geeta are partners sharing profits and losses in the ratio of 3 : 2 : 1 respectively. It was decided that Indu is to retire from the firm. On this date, a machine having a book value of Rs 60,000 is revalued at Rs 90,000. Which of the following is correct in this regards?

Rs 10,000 is to be debited to Indu`s account

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Rs 10,000 is to be credited to Indu`s account

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Rs 20,000 is to be debited to Indu`s account

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Rs 20,000 is to be credited to Indu`s account

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Solution

The correct option is B
Rs 10,000 is to be credited to Indu`s account

Revaluation profit = 90,000-60,000= 30,000. Indu`s share = 30,000 x 2/6 = 10,000. Revaluation profit is credited to Partner's Capital A/c.

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Mitali, Indu and Geeta are partners sharing profits and losses in the ratio of 3 : 2 : 1 respectively. It was decided that Indu is to retire from the firm. On this date, a machine having a book value of Rs 60,000 is revalued at Rs 90,000. Which of the following is correct in this regards?

The correct option is B Rs 10,000 is to be credited to Indu`s account Revaluation profit = 90,000-60,000= 30,000. Indu`s share = 30,000 x 2/6 = 10,000. Revaluation profit is credited to Partner's Capital A/c.

The correct option is B
Rs 10,000 is to be credited to Indu`s account

Revaluation profit = 90,000-60,000= 30,000. Indu`s share = 30,000 x 2/6 = 10,000. Revaluation profit is credited to Partner's Capital A/c.