Page 347 - MA-12

M.38 Management Accounting (Section B)—ISC XII

Dr. PARTNERS’ CAPITAL ACCOUNTS Cr.
Particulars Ram Mohan Sohan Particulars Ram Mohan Sohan
` ` ` ` ` `
To Realisation A/c 1,80,000 1,42,000 80,000 By Balance b/d 2,45,000 90,000 60,000
To Realisation A/c (Loss) 40,800 13,600 13,600 By Realisation A/c 60,000 ... 15,300
To Advertisement By Realisation A/c 2,700 ... ...
Suspense A/c 30,000 10,000 10,000 By General Reserve A/c 60,000 20,000 20,000
To Bank A/c 1,16,900 ... ... By Bank A/c ... 55,600 8,300
(Balancing Figure) (Balancing Figure)
3,67,700 1,65,600 1,03,600 3,67,700 1,65,600 1,03,600

Dr. BANK ACCOUNT Cr.
Particulars ` Particulars `
To Balance b/d 32,000 By Ram’s Capital A/c 1,16,900
To Realisation A/c (Debtors) 21,000 (Final Payment)
To Mohan’s Capital A/c (Cash brought in) 55,600
To Sohan’s Capital A/c (Cash brought in) 8,300
1,16,900 1,16,900

Working Notes:
1. Book Value of Investment taken over by Mohan = ` 72,000 × 10/9 = ` 80,000.
2. Remaining investment = ` 1,70,000 – ` 80,000 = ` 90,000.
3. Book Value of Investment taken over by Sohan = 90% of ` 90,000 = ` 81,000.
4. Agreed value of investment taken over by Sohan = ` 81,000 – ` 1,000 = ` 80,000.

Section B

9. (a) CASH FLOW FROM INVESTING ACTIVITIES
Particulars `
Purchase of Machinery (` 4,00,000 – ` 3,00,000) (1,00,000)
Purchase of 10% Investments (1,00,000)
Rent Received 30,000
Dividend Received from Investment in shares (10% of ` 1,50,000) 15,000
Sale of 10% Investments (WN 1) 60,000
Interest Income on 10% Investments 12,000
Sale of Patents (WN 2) 15,000
Cash Used in Investing Activities (68,000)

Working Notes:
1. Dr. 10% INVESTMENTS ACCOUNT Cr.
Particulars ` Particulars `
To Balance b/d 1,50,000 By Bank A/c (Sale) (Balancing Figure) 60,000
To Bank A/c (Purchase) 1,00,000 By Balance c/d 2,00,000
To Statement of Profit and Loss (Profit on Sale) 10,000
2,60,000 2,60,000