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This section includes InterviewSolutions, each offering curated multiple-choice questions to sharpen your knowledge and support exam preparation. Choose a topic below to get started.
| 1051. |
Receipt and Payment Account of Shankar Sports club is given below, for the year ended March 31, 2017 Receipt and Payment Account for the year ending March 31, 2017 Prepare Income and Expenditure Account and Balance Sheet with help of following Information: Subscription outstanding on March 31, 2016 is Rs.1, 200 and Rs.2, 300 on March 31, 2017, opening stock of postage stamps is Rs.300 and closing stock is Rs. 200, Rent Rs.1, 500 related to 2015 and Rs.1, 500 is still unpaid. On April 1, 2016 the club owned furniture Rs.15, 000, Furniture valued at Rs. 22,500 On March 31, 2017, the club took a loan of Rs.20,000 (@ 10% p.a) in 2017. |
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| 1052. |
Receipts and Payments Account generally shows : |
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Answer» A DEBIT BALANCE |
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| 1053. |
Receipts andPayments Account is a |
| Answer» Solution :Real Account | |
| 1054. |
Receipts and Payments Account is a : |
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Answer» (a) PERSONAL ACCOUNT |
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| 1055. |
Realisation expenses Rs 15,000 were paid by the firm on behalf of a partner. Which of the following entry will be passed ? |
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Answer» `{:(,,Rs,Rs,),("REALISATION A/c",...DR,"15,000",,),("To Cash/Bank A/c",,,"15,000",):}` |
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| 1056. |
Realisation expenses of Rs 10,000 were to be borne and were also paid by a partner. State which account will be debited and credited |
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Answer» `{:(,,RS,Rs),("REALISATION Account",....Dr,"10,000",),("To Cash A/c",,,"10,000"):}` |
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| 1057. |
Rayan Ltd. Provides the followinginfromation.DetermineCash FlowformFinancing Activites: AdditionalInforamation : 1. Interest paidDebentures ₹ 10,000. 2. Dividend paid ₹ 50,000. During the years 2018- 19, Rayam Ltd. issued sharein theratio of 2:1 by capitalisngreserve. |
Answer» SOLUTION :
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| 1058. |
RealisationA/C is a : |
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Answer» NOMINAL A/C |
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| 1059. |
Raw materials purchased is shown in the Statement of Profit and Loss as: |
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Answer» Purchases of Stock-in-Trade, |
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| 1060. |
Rattan Ltd. Is to redeem 10,000 ,8% Debentures of Rs. 100 each at a premium of Rs. 10 out of profit . Amount that should be should be set aside to Debenture Redemption Reserve (DRR) is |
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Answer» Rs.2,50, 000. |
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| 1061. |
Rattan Ltd. Is to redeem 10,000, 8% Debentures of Rs 100 each at a premium of Rs 10 out of profit. Amount that should be set aside to Debenture Redemption Reserve (DRR) is |
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Answer» RS 2,50,000 |
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| 1062. |
Ratio analysis is a tool for analysing the financial statements of any enterprise. |
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| 1063. |
Rani and Suman are in partnership with capitals of Rs, 80,000 and Rs. 60,000, respectively. During the year 2015-16, Rani withdrew Rs. 10,000 from her capital and Suman Rs. 15,000. Profits before charging interest on capital was Rs. 50,000. Ravi and Suman shared profits in the ratio of 3:2. Calculate the amounts of interest on their capitals @ 12%p.a. for the year ended March 31, 2016. |
| Answer» Solution : Interest on CAPITAL, RANI, RS. 9,600, SUMAN, Rs. 7,200 | |
| 1064. |
Ranjana, Sadhna and Kamana are partners sharing profits in the ratio 4:3:2. Ranjana retires, Sadhna and Kamana decided to share profits in future in the ratio of 5:3. Calculate the Gaining Ratio. |
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Answer» SOLUTION :GAINING Share = New Share - OLD Share Sadhna's Gaining Share = `(5)/(8)-(3)/(9)=(45-24)/(72)=(21)/(72)` Kamana's Gaining Share = `(3)/(8)-(2)/(9) = (27-16)/(72) = (11)/(72)` Gaining Ratio between Sadhna and Kamana = 21:11. |
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| 1066. |
Ramesh and Suresh were partners in a firm sharing profits in the ratio of their capitals contributed on commencement of business which were Rs. 80,000 and Rs. 60,000 respectively. The firm started business on April 1, 2016. According to the partnership agreement, interest on capital and drawings are 12% and 10% p.a., respectively. Ramesh and Suresh are to get a monthly salary of Rs. 2,000 and Rs. 3,000, respectively. The profits for year ended March 31, 2017 before making above appropriations was Rs. 1,00,300. The drawings of Ramesh and Suresh were Rs. 40,000 and Rs. 50,000, respectively. Interest on drawings amounted to Rs. 2,000 for Ramesh and Rs. 2,500 for Suresh. Prepare Profit and Loss Appropriation Account and partners’ capital accounts, assuming that their capitals are fluctuating. |
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| 1067. |
RameshandNaresh areparthnersin afirm theircapitalsas nApril2018 Were Rs. 2,50,000andRs. 1,50,000Repectively, theyshareprofits equallyO1stjuly2018theydecided thattheircapitalsshouldbe Rs.2,00,000eachthenecesaryadhusmentin thecapitalsweremadethattheircapitals ahould be Rs. 2,00,000each, thenecessaryadjustment in thecapiitalsweremade byintroducingorwithdrawingcapitalinterestn capitalsis allowed @ 8%p.acpmpute interest on capital forboththepartnersfortheyearended31stended March 2019. |
| Answer» SOLUTION :` {:((i) ,"interest on Ramesh'scapital :", Rs.),(,"From 1st April . 2018 to 30 st june. 2018"(Rs. 2.50.000xx8//100xx3//12),5.000),(,"From 1st july.2018 to 31 St MARCH .2019" (rs. 2.00.000xx8//100xx9//12),12.000),(,,),((ii), "interest on Naresh 's capital:",),(,"from1st april , 2018 to 31st March .2019 "(rs. 2.00.000xx8//100xx3//12),3.000),(,"from1stjuly .2018to 31st March 2019"(Rs.2.00.000xx8//100xx9//12),12.000),(,,UNDERLINE overline(15.000)):}` | |
| 1068. |
Raman, Ratan and Rajan were partners sharing profits in the ratio of 4:2:1 respectively. Following was their Balance Sheet as at 31st March, 2013: On the above date, Raman retired and folloeing were agreed: (i) The assets and liabilities were valued as: Stock Rs 24,000, Debrors Rs 21,000, Building Rs 45,200, Plant Rs 50,000 and Creditors Rs 28,000. (ii) Amount due to Raman will be transfered to Raman's Loan Account. Prepare Revaluation Account and Raman's Capital Account. |
Answer» SOLUTION :
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| 1069. |
Ram , shyam and Mohanwerepartnersin a firmsharingprofitsand lossesin theratio of 2:1:2 their capitals were fixed atRS. 3,00,000RS. 1,00,000 Rs. 2,00,000for theyearended31st March ,2019 interest oncapitalwas creditedto them@9%insteadfo 10%p.atheprofitfor the yearbeforecharginginterestwas Rs. 2,52,000showyourworkingnotesclearlyand Passnecessaryadjustment entry |
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| 1070. |
Ram, Raj and George are partners sharing profits in the ratio 5 : 3 : 2. According to the partnership agreement George is to get a minimum amount of Rs. 10,000 as his share of profits every year. The net profit for the year 2013 amounted to Rs, 40,000. Prepare the Profit and Loss Appropriation Account. |
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| 1071. |
Ram, Mohan, Sohan and Hari were partners in a firm sharing profits in the ratio of 4:3:2:1. On 1st April, 2016, their Balance Sheet was as follows : From the above date, the partners decided to share the future profits in the ratio of 1:2:3:4. For this purpose the goodwill of the firm was valued at ₹ 1,80,000. The partners also agreed for the following : (a) The claim for workmen compensation has been estimated at ₹ 1,50,000. (b) Adjust the capitals of the partners according to new profit-sharing ratio by opening Partner's Current Accounts. Prepare Revaluation Account, Partners' Capital Accounts and the Balance Sheet of the reconstituted firm. |
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| 1072. |
Ram, Krishna and Ganesh were sharing profits and losses in the ratio of 5:3:2. Ram retires and Krishna and Ganesh share the future profits and amount of goodwill of the firm is valued at Rs. 1,00,000. Calculate the amount of goodwill to be debited to Krishan's and Ganesha'sCapital A/c. |
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Answer» RS. 60,000 & Rs. 40,000 |
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| 1073. |
Rammohanandsohansharing profitand lossesequallyhavecapitalsof Rs. 1,20,000 Rs. 90,000and Rs. 60,000respectivelyfor theyearended31st March, 2019interestwasendedon capitalwascreditedto them@6%insteadof5% GIveadjustmentjouralentry . |
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| 1074. |
Ram and Shyam were partners in a firm sharing profits in the ratio of 2:3 respectively. They became old and no one where to look after their business. Therefore, they decided to dissolve the business and donate the amount available to an NGO who is providing service for growing trees in urban areas to control pollution. On 31st March, 2014, their Balance Sheet was as follows: Ram paid the Creditors at a discount of 15% and Shyam paid Bills Payable in full Assets realised as follows: Land at 20% less, Machinery at Rs 35,000, Stock at 25% less and Debtors at Rs 12,500.Expenses on relisation Rs 1,750 were paid by Shyam. Prepare Realisation Account, Partners' Capital Accounts and Cash Account. |
| Answer» Solution :LOSS on Reallsation-Rs 69,750, FINAL PAYMENT, RAM -Rs1,02,350, and Shyam-Rs 69,900. Total of CASH Account-Rs 1,72,250. | |
| 1075. |
Ram, Ghanshyam and Vrinda were partners in a firm sharing profits in the ratio of 4:3:1. The firm closes its books on 31st March every year. On 1st February, 2015 Ghanshyam died and it was decided that the new profit-sharing ratio between Ram and Vrinda will be equal. The Partnership Deep provided for the following on the death of a partner: (a) His share of goodwill be calculated on the basis of half of the profits creditd to his account during the previsous four completed years. The firm's profit for the last four years was: 2010-11-Rs 1,20,000,2011-12-Rs 80,000,2012-13-13-Rs 40,000, and 2013-14 Rs 80,000. (b) His share of profit in the year of his death was to be computed on the basis of average profits of past two years. Pass necessary Journal entries relating to goodwill and profit to be' trnsferred to Ghanshyam's Capital Account. Also show your working clearly. |
Answer» Solution : Working NOTES: 1. Calculation of Ghanshyam's Share of GOODWILL: Total profit of LAST four years =Rs 1,20,000+Rs 80.000 + Rs 40,000 + Rs 80,000= Rs 3,20,000 Ghanshyam's share in last four year's profit `=Rs3,20,000xx3//8=Rs1,20,000` Ghanahyam's share of Goodwilll `=Rs1,20,000xx1//2=Rs60,000.` 2. Calculation of gaining ratio: Gain of a partner = New share - Old share RAM's Gain `=1//2-4//8=Nil` Vrinda's Gain `=1//2-1//8=(4-1)/(8)=3/8` Hence, Vrinda is only gaining partner. 3. Calculation of Ghanshyam's share of profit till the date of death: Average profit of PAST two years `=(Rs40,000+Rs80,000)/(2)=Rs60,000` Profit for 10 months (from 1st April ,2014 to 1st February, 2015)=Rs `60,000xx10//12=Rs 50,000` Ghanahyam's share of profit `=Rs50,000xx3//8=Rs18,750.` Due to change of profit-sharing ratio in the new firm, Ghanshyam's share of profit will be adjusted through Vrinda's Capital Account (gaining partner) not through profit and Loss Suspense A/c. |
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| 1076. |
Ram and Shyam were partners in a firm sharing profits in the ratio of 2:3 respectively They beame old and no one was there to look after their business. Therefore, they decided to dissolve the business and donate the amount to an NGO who are providing service of growing trees in urban areas to control polution. Identify any one value which the partners communicated to the society. |
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| 1077. |
Ram and Rahim are partners in a firm. They share profit in the ratio of 3 : 2. Their Balance Sheet as at 31st March, 2019 was: They admitted Prabhu as a new partner on 1st April 2019 on the following terms: (i) Prabhu will bring in RS. 2,00,000 as capital and the necessary amount for goodwill. (ii) New profit-sharing ratio among Ram, Rahim and Prabhu will be 5 : 3 : 2. (iii) Amount of goodwill is to be based on Prabhu's share in profits and capital contributed by him. (iv) Stock to be reduced by 10%. (v) Provision for Doubtful Debts is to be RS.5,000. (vi) Plant and Machinery is to be reduced by 5%. (vii) Expenses on revaluation of assets and reassessment of liabilities were Rs.1,400 and were paid by firm. (viii) An unaccounted Accrued Income of RS.1,400. Prepare Revaluation Account, Bank Account Partaner's Capital Accounts and the Balance Sheet of the New Firm. |
Answer» SOLUTION :  Working Note: 1. Calculation of Sacrificing Ratio (Sacirfice =Old Share-New Share): Ram's sacrifice = 3/5 -5/10=1/10, RAHIM's sacrifice = 2/5 -3/10 =1/10 Thus, Sacrificing Ratio of Ram and Rahim = 1/10 : 1/10 or 1:1. 2. Calculation of Hidden Goodwill: PRABHU contributes Capita for 2/10th share =RS.2,00,000 (A) Total capital of the firm should be `=2,00,000xx10/2=RS.10,00,000` (B) Actual total capital of Ram ,Rahim (after adjustment of REVALUATION loss) and Prabhu is `[RS.3,00,000+RS.1,50,000-RS.7,000("i.e.,loss on revaluation")+2,00.000]=RS.6,43,000` (C) Hidden Goodwill (A-B) =RS.10,00,000-RS.6,43,000=RS.3,57,000. Prabhu's share of Goodwill =1/5th of RS. 3,57,000=RS.71,400. |
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| 1078. |
Ram and mohantwopartnersdrewfortheirparsonaluse Rs. 1,20,000and Rs. 80,000interestis chargeable@6% p.aon thedrawingwhatis theamountof intereschargeablefromeachpartner ? |
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| 1079. |
Ramand mohan arepartners in afirm. TheyadmittedRakhias a partnerwithoutcapital for 1/3 rdsharein the profitof thefirmsheisblindbybirthbuthavingmanagementqualities ,thenewParnershipof thefirm,sheis blind by bothbuthavinggoodmanagementqualites . thenewpartnership agreement provides for thethe following : (i ) 10%of thetradingprofitwillbednatedtoprimeMinister 'sRelierfFund . (ii)5%of thetradingprofit will bedonatedto theNationalBlind Relief fund. (iii)Productswillbesoldata discountof15%on maximum Retailpriceto thepeopleliving belowpoverty line . (iv)NewRatailshops will beopenedin theNexal Affectedareas of thecountry . (v)Newjobs of salespersonswill bereserved for thegirlsbelonging toscheduled Castes andscheduledTribes . TradingProfitofthefirmfor theyearended31st March ,2012 was Rs, 10,00,000, Prepare profitand Loss Appropriation Account of Ram ,mohan AndRakhi For theyear ended31 st MArch ,2012. |
Answer» SOLUTION :
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| 1080. |
Rakhi and Shikha are partners in a firm, with capitals of Rs. 2,00,000 and Rs, 3,00,000 respectively. The profit of the firm, for the year ended 2016-17 is Rs. 23,200. As per the Partnership agreement, they share the profit in their capital ratio, after allowing a salary of Rs. 5,000 per month to Shikha and interest on Partner’s capital at the rate of 10% p.a. During the year Rakhi withdrew Rs. 7,000 and Shikha Rs. 10,000 for their personal use. As per partnership deed, salary and interest are caption treated as charged. You are required to prepare Profit and Loss Account and Partner’s Capital Accounts. |
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| 1081. |
Ramand mohanare partners in abusiness theircapitalsat theof theyearwereRS. 24,000andRs. 18,000respectivelyDuring theRam'sdrawingsand mohan'sdrawingswere Rs. 4,000 and Rs. 6,000respectively. Profit(beforechargingintereston capital) during the yearwasRs. 16,000calculateintereston capital@5%p.a for theyearended31st March, 2019 . |
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| 1082. |
Raju and Jai commenced business in partnership on April 1, 2017. No partnership agreement was made whether oral or written. They contributed Rs. 4,00,000 and Rs. 1,00,000 respectively as capitals. In addtion, Raju advanced Rs. 2,00,000 as loan to the firm on October 1, 2017. Raju met with an accident on July 1, 2017 and could not attend the business up to september 30, 2017. The profit for the year ended March 31, 2018 amounted to Rs, 50,600. Disputes have arisen between them on sharing the profits of the firm. Raju Claims: (i) He should be given interest at 10% p.a. on capital and so also on loan. (ii) Profit should he distributed in the proportion of capitals. Jai Claims: (i) Net profit should be shared equally. (ii) He should be allowed remuneration of Rs, 1,000 p.a. during the period of Raju’s illness. (iii) Interest on capital and loan should be given@ 6%p.a. State the correct position on each issue as per the provisions of the Partnership Act. 1932. |
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Answer» Solution : (i) Interest on LOAN given `6% `p.a. (ii) No interest allowed on capital and charged on DRAWINGS (iii) Salary and Commission not given to partner (IV) Profit to the shared EQUALLY |
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| 1083. |
Rajiv and Sanjeev were partners in a firm. Their Partnership Deed provided that the profits shall be divided as follows: Firsh Rs 20,00 to Rajeev and the balance in the of 4:1. The profits for the year ended 31st March,2017 were Rs 60,000 which had been distributed among the partners. On 1st April, 2016 their capitals were Rajeev Rs 90,000 and Sanjeev Rs 80,000. Interest on capital was to be provided @6% p.a. While preparing the profit and loss appropriatin interest on capital was omitted. Pass necessary fectifying entry for the same. Show your workings clearly. |
Answer» Solution : A. DISTRIBUTION of profit before RECTIFICATION: `{:(,"Rajiv(RS)","SANJEEV(Rs)"),("First Rs 20,000","20,000",...),("Remaining Rs 40,000 in the ratio of 4:1","32,000","8,000"),(, underline underline OVERLINE ("52,000"),underline underline overline ("8,000")):}` B. Interest on Capital: Rajiv = Rs `90,000xx6//100` = Rs 5,400 Sanjeev = Rs `80,000xx6//100=` Rs 4,800 C. Distribution of Profit after rectification (Rs 60,000- Rs 5,400- Rs 4,800) will be as follows: `{:(,"Rajiv (Rs)","Sanjeev (Rs)"),("First Rs 20,000","20,000",...),("Remaining Rs 29,800 in the ratio of"4:1,"23,840","5,960"),(, underline underline overline("43,840"),underline underline overline ("5,960")):}` |
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| 1084. |
Rajesh Ltd. Issued a prospectus inviting applications for 3,00,000 shares of Rs. 10 each at a premium of Rs. 4 per share, payable as follows : On Application - Rs. 4 (including Rs. 1 premium) On Allotment - Rs. 3 (including Rs. 1 premium) On First Call - Rs. 4 (including Rs. 1 premium) On Second & Final Call - Rs. 3(including Rs. 1 premium) Applications were received for 3,80,000 shares and pro-rata allotment was made on the applications for 3,50,000 shares. It was decided to utilise excess application money towards the sums due on allotment. X, to whom 6,000 shares were allotted, failed to pay the allotment money and his shares were forfeited after allotment. Y, who applied for 10,500 shares failed to pay the two calls and on his such failure, his shares were forfeited. Z, who was allotted 3,000 shares did not pay final call. Of the shares forfeited, 11,000 shares were reissued as fullypaid up for Rs. 9 per share, the whole of Y's shares being included. Prepare Cash Book, Journal and Show the relevant items in the Balance Sheet. |
Answer» SOLUTION :   
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| 1085. |
Rajan and Rajani are partners in a firm. Their capitals were Rajan Rs. 3,00,000, Rajani Rs. 2,00,000. During the year 2015 the firm earned a profit of Rs. 1,50,000. Calculate the value of goodwill of the firm assuming that the normal rate of return is 20%? |
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| 1086. |
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: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 account2. Partner’s capital accounts and3. Balance sheet of the firm after retirement of Sheela. |
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| 1087. |
Quick Ratio of a company is 1.7:1. State giving reasons,which of the following would improce reduce or not change the ratio: (i) Purcahse of Inventory for cash, (ii) Cash collected from debtors, (iii)Sale of goods (costing 10000) for 60000,(iv)Sale of an office furniture (Book value 10,000) for 7500, and (v) Payment of Dividend. |
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Answer» SOLUTION :(i) Goods purchased for cash will reduce the total of quick assets .THEREFORE , the Quick RATIO willreduce (ii) Cash collected from DEBTORS will not change the total of quick assets because one quick asset will be replaced by another.Therefore, the Quick Ratio will not change (iv) Sale of funiture ofr Rs 7500 will INCREASE the total of quick assets . Therefore , the Quick Ratio will improve. (v) Payment of Dividend will reduce the quick assets as well as current liabilities by the same amount .Therefore, the Quickl Ratio will improve |
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| 1088. |
Quick ratio of a company is 1.5:1 state giving reason whether the ratio will improve decline or not change on payment of dividend by the company |
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| 1089. |
Quick ratio of a company is 1.5 : 1 state with reason whether the purchase of inventory for cash will improve reduce or not change the ratio. |
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| 1090. |
Quick Ratio of a company is 1 : 1. State giving reasons (for any four),which of the following would improve, reduce or not change the ratio?(i) Purchase of machinery for cash(ii)Purchase of goods on credit(iii)Sale of furniture atcost(iv)Sale of goods at a profit(v)Redemption of debentures at a premium |
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Answer» Solution :(i) Purchase of MACHINERY for cash will reduce the total of Quick, Assets but total current liabilities will remain unchanged. Therefore, Quick RATIO will reduce. (ii) Purchase of goods on credit will increase total of current liabilities but total Quick Assets will remain unchanged. Therefore, Quick Ratio will reduce. (iii) Sale of furniture at cost will increase the total of Quick Assets. Therefore, Quick Ratio will improve. (iv) Sale of goods at PROFIT will increase the total of Quick Assets. Therefore, Quick Ratio will improve. (v) Quick Ratio will not change SINCE Quick Assets and Current Liabilities(because as per SCHEDULE III redeemable debentures are Current Liabilities) both will reduce with the amount paid. |
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| 1091. |
Quick ratio of a company is 1.5 : 1 state with reason whether cash collected against trade receivables would improve reduce or not change the ratio. |
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| 1092. |
Qadir and Rishab are partners sharing profits in the ratio of 3:2. Their Balance Sheet as at 31st March, 2016 is given below: Qadir and Rishab decide to admit Sapna as a new partner from 1st April, 2016. Their new profit-sharing ratio was 3:2:5. Sapna brought in Rs 6,00,000 as her capital and her share of goodwill premium in cash. (a) Sapna's share of goodwill premium was valued at Rs 30.000 (b) Plant and Machinery be calued at 125% (c) Creditors were unrecorded to the extent of Rs 30,000. (d) Claim on account of workmen compensation was Rs 40,000. Prepare Revaluation Account, Partners' Capital Account and the Balance Sheet of the reconstituted firm. |
| Answer» Solution :GAIN on Revaluation- Rs 1,20,000. PARTNERS' Capital Accounts: Qadir-Rs 12,42,000, RISHAB- Rs 7,68,000, SAPNA- Rs 6,00,000, Balance SHEET Total-Rs 27,80,000. | |
| 1093. |
Quick Ratio is also known as: |
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Answer» LIQUID RATIO |
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| 1094. |
Quick Assets do not include |
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Answer» CASH in hand |
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| 1095. |
Purchased goodwill arises at the time of |
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Answer» CLOSURE of BUSINESS. |
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| 1096. |
Purchase Rs. 7,20,000, Office Expenses Rs. 30,000, Selling Expenses Rs. 90,000, Opening Inventory Rs. 1,40,000, Closing Inventory Rs. 80,000, Revenue from Operations Rs. 12,00,000. Calculate operating ratio |
| Answer» Answer :B | |
| 1097. |
Purchase of patents would result in inflow, outflow or no flow of cash. Give your answer with reason. |
| Answer» SOLUTION :Purchase of patents WOULD result in outflow of CASH because it is a payment and THUS, DECREASES cash. | |
| 1098. |
Purchase of goods for reselling is shown in the Statement of Profit and Loss under: |
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Answer» Changes in Inventories of FINISHED GOODS, Work-in-Progress and Stock-in-Trade, |
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| 1099. |
Puneet, Pankaj and Pammy are partners in a business sharing profits and losses in the ratio of 2 : 2 : 1respectively. Their balance sheet as on March 31, 2017 was as follows:Mr. Pammy died on September 30, 2017. The partnership deed provided the following: (i) The deceased partner will be entitled to his share of profit up to the date of death calculated on the basis of previous year’s profit. (ii) He will be entitled to his share of goodwill of the firm calculated on the basis of 3 years’ purchase of average of last 4 years’ profit. The profits for the last four financial years are given below:The drawings of the deceased partner up to the date of death amounted to Rs. 10,000. Interest on capital is to be allowed at 12%per annum.Surviving partners agreed that Rs. 15,400 should be paid to the executors immediately and the balance in four equal yearly instalments with interest at 12%p.a. on outstanding balance.Show Mr. Pammy’s Capital account, his Executor’s account till the settlement of the amount due. |
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| 1100. |
Prpfit or loss of realisationaccount is transferred to : |
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Answer» Profit &LOSS Account |
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