Bzziii.com

Home
Retirement-of-a-partner

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 | Bzziii.com

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
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 Creditors3,000Cash-in-Hand1,500
Bills Payable4,500Cash at Bank7,500
Expenses Owing4,500Debtors15,000
General Reserve13,500Stock12,000
Capitals:45,000Factory Premises22,500
Radha 15,000Machinery8,000
Sheela 15,000Losse Tools4,000
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.




Books of Radha,Sheela and Meena
Revaluation account
Particulars
Amount
(Rs.)
Particulars
Amount
(Rs.)
To Machinery800By Expense owing750
To Loose Tools400By Factory premise1,800
To Profit transferred to:
Meena’s Capital A/c675
Radha’s Capital A/c450
Sheela’s Capital A/c2251,350
2,2502,250
Partner’s Capital A/c

ParticularsRadhaSheelaMeenaParticularsRadhaSheelaMeena
To Sheela’s Capital A/c3,3751,125By balance b/d15,00015,00015,000
To Sheela’s loan A/c24,450By Reserve6,7504,5002,250
To balance c/d19,05016,350By Revaluation A/c675450225
By Radha’s Capital A/c3,375
By Meena’s Capital A/c1,125
22,42524,45017,47522,42524,45017,475

Balance Sheet
as on April 01,2017

Liabilities
Amount
(Rs.)
Assets
Amount
(Rs.)
To Bills Payable4,500By Cash at Bank7,500
To Expense owing3,750By Cash in hand1,500
To Trade Creditors3,000By Debtors15,000
To Sheela’s loan24,450By stock12,000
By Machinery8,000
Less: 10%(revaluation)8007,200
To Partner’s CapitalBy Factory premisses24,300
Radha19,050By lose tools4,000
Meena16,35035,400Less: 10%4003,600
71,10071,100


WN.1.

(i) General reserve is to be written off among all partners in old profit sharing ratio.

(ii) Sheela’s share of goodwill = 13,000×2/6

= Rs. 4,333

(iii) Gaining ratio of remaining partner’s

Calculations for Radha’s gain

= `3/3`-`3/6` = `"18 - 12"/"24"` = `6/24`

Calculations for Meena’s gain

= `1/4`-`1/6` = `"6 - 4"/"24"` = `2/6`

(iv) Contribution for goodwill of retiring partner by remaining partners

Radha 

= 4,333×`3/4`

= Rs. 3,250

Meena 

= 4,333×`1/4`

= Rs. 1,083

Hello, welcome to the GovtCareerAssam blog! I'm Dipankar Baruah, the author and admin, here to provide you valuable information on government careers in Assam.