Page 103 - MA-12

Retirement and Death of a Partner 4.33
Solution: JOURNAL
Date Particulars L.F. Dr. (`) Cr. (`)

2019 Ansh’s Capital A/c ...Dr. 2,400
June 30 Dev’s Capital A/c ...Dr. 5,600
To Vansh’s Capital A/c 8,000
(Being Vansh’s share of goodwill adjusted in the Capital Accounts of
Ansh and Dev in the gaining ratio of 3 : 7) (WN 1 and 2)
Revaluation A/c ...Dr. 2,700
To Stock A/c 1,000
To Provision for Doubtful Debts A/c 1,000
To Furniture A/c 400
To Provision for Outstanding Expenses A/c 300
(Being the decrease in assets and increase in liabilities)
Machinery A/c ...Dr. 3,000
To Revaluation A/c 3,000
(Being the increase in the value of machinery)
Revaluation A/c ...Dr. 300
To Ansh’s Capital A/c 150
To Vansh’s Capital A/c 100
To Dev’s Capital A/c 50
(Being the gain (profit) on revaluation divided in the old ratio)
Reserve A/c ...Dr. 24,000
Workmen Compensation Reserve A/c ...Dr. 6,000
To Ansh’s Capital A/c 15,000
To Vansh’s Capital A/c 10,000
To Dev’s Capital A/c 5,000
(Being the transfer of free Reserves to the Partners’ Capital Accounts in the old ratio)
Profit and Loss Suspense A/c ...Dr. 45,000
To Ansh’s Capital A/c 22,500
To Vansh’s Capital A/c 15,000
To Dev’s Capital A/c 7,500
(Being the estimated profit till the date of retirement transferred
to the Capital Accounts in the old ratio)
Bank A/c ...Dr. 55,100
To Ansh’s Capital A/c 15,130
To Dev’s Capital A/c 39,970
(Being the cash brought in by Ansh and Dev as per agreement) (WN 3)
Vansh’s Capital A/c ...Dr. 93,100
To Bank A/c 93,100
(Being the payment made to Vansh on his retirement)
Dr. PARTNERS’ CAPITAL ACCOUNTS Cr.
Particulars Ansh (`) Vansh (`) Dev (`) Particulars Ansh (`) Vansh (`) Dev (`)
To Vansh’s Capital A/c 2,400 ... 5,600 By Balance b/d 80,000 60,000 40,000
(WN1) (Goodwill) By Ansh’s Capital A/c ... 2,400 ...
To Bank A/c ... 93,100 ... (WN 1)
(Balancing Figure) By Dev’s Capital A/c ... 5,600 ...
To Balance c/d (WN 3) 1,30,380 ... 86,920 (WN 1)
By Revaluation A/c (Gain) 150 100 50
By Reserve A/c 12,000 8,000 4,000
By Workmen
Compensation Reserve 3,000 2,000 1,000
By Profit and Loss
Suspense A/c 22,500 15,000 7,500
By Bank A/c (Bal. Fig.) 15,130 ... 39,970
1,32,780 93,100 92,520 1,32,780 93,100 92,520