Page 353 - MA-12

M.44 Management Accounting (Section B)—ISC XII

Raman, a shareholder holding 500 shares paid both the calls along with allotment.
Kamal, a shareholder holding 1,000 shares did not pay first call and second and
final call. His shares were forfeited. 800 of these forfeited shares were reissued at
` 120 per share as fully paid-up.
Pass necessary Journal entries for the above transactions in the books of the company. Also
show relevant items as they would appear in the Balance Sheet of the company. [12]
5. Deepika and Rajshree are partners sharing profits and losses in the ratio of 3 : 2. Their
Balance Sheet as on 31st March, 2019 is as under:
Liabilities ` Assets `
Creditors 75,000 Goodwill 5,000
Bank Overdraft 50,000 Building 30,000
Workmen Compensation Reserve 10,000 Furniture 1,25,000
Investment Fluctuation Reserve 5,000 Investments (Market Value ` 22,500) 25,000
Employees’ Provident Fund 5,000 Debtors 50,000
Anshu’s Loan 1,50,000 Less: Provision for Doubtful Debts 5,000 45,000
Capital A/cs: Stock 1,50,000
Deepika 88,000 Bank Balance 1,25,000
Rajshree 1,27,000 2,15,000 Advertisement Suspense A/c 5,000
5,10,000 5,10,000
On 1st April, 2019, they admit Anshu as a partner on the following terms:
(i) Deepika will sacrifice 1/3rd of her share while Rajshree sacrifices 1/10 from her
share in favour of Anshu.
(ii) Anshu’s loan will be converted into his capital.
(iii) Anshu brings 60% of his share of goodwill by cheque.
(iv) Goodwill is to be valued at 2 years’ purchase of super profit of last three completed
years. Profits for the last three years ended 31st March, are as follows:
2017—` 2,40,000; 2018—` 4,65,000; and 2019—` 6,90,000.
Normal profit is ` 3,15,000 with same amount of capital invested in similar
industry.
(v) Value of building is to be increased by ` 25,000, value of Stock and Furniture
to be reduced by 15% and 10% respectively. Provision for Doubtful Debts is
to be made equal to 5% of the debtors.
(vi) Claim on account of Workmen Compensation is ` 5,000.
(vii) An unrecorded accrued interest income of ` 5,000 to be accounted. A debtor
whose dues of ` 25,000 were written off as bad debts, paid ` 20,000 in full
settlement.
(viii) Workmen Compensation Reserve and Investment Fluctuation Reserve are to
appear in the books of new firm after adjusting Workmen Compensation Claim
and difference between book value and market value of investment.
(ix) Capital Accounts of the partners to be readjusted on the basis of their profit-
sharing ratio and any excess or deficiency be adjusted in cash.
Prepare Revaluation Account, Partners’ Capital Accounts and the Balance Sheet. [12]
6. On 1st April, 2017, Strong Ltd. issued ` 40,00,000, 10% Debentures of ` 100 each at a premium
of 5% and redeemable at a premium of 10% in equal annual drawings by draw of lots
in 2 years. Pass the necessary Journal entries during the years of Issue and Redemption
of Debentures without providing for the interest and Loss on Issue of Debentures. [12]