Page 141 - DEBKVOL-1

6.8 Double Entry Book Keeping—CBSE XII
BALANCE SHEET OF JYOTI AND YOGESH
as at 1st April, 2018
Liabilities ` Assets `
Capital A/cs: Building 1,20,000
Jyoti 1,20,000 Machinery 38,400
Yogesh 60,000 1,80,000 Prepaid Insurance 3,000
Sundry Creditors 21,600 Debtors 20,000
Less: Provision for Doubtful Debts 1,000 19,000
Stock 18,000
Bank (WN 3) 3,200
2,01,600 2,01,600

Working Notes:
1. Ruchi’s share of goodwill = ` 72,000 × 3/9 = ` 24,000, which is contributed by Jyoti and Yogesh in their
gaining ratio of 2 : 1 as: Jyoti: ` 24,000 × 2/3 = ` 16,000; Yogesh: ` 24,000 × 1/3 = ` 8,000.
2. Capital of Jyoti and Yogesh in New Firm:
Total capital of the firm after Ruchi’s retirement will be ` 1,80,000. It will be shared by Jyoti and Yogesh in the
ratio of 4 : 2, i.e., 2 : 1. Therefore, capital of Jyoti will be ` 1,20,000 (i.e., ` 1,80,000 × 2/3) and that of Yogesh
will be ` 60,000 (i.e., ` 1,80,000 × 1/3).
3. Dr. BANK ACCOUNT Cr.
Particulars ` Particulars `
To Balance b/d (` 8,000 + ` 8,000) 16,000 By Ruchi’s Capital A/c 88,267
To Jyoti’s Capital A/c 50,311 By Balance c/d 3,200
To Yogesh’s Capital A/c 25,156
91,467 91,467

Illustration 7.
A, B and C are partners sharing profits in the ratio of 4 : 3 : 1. Their Balance Sheet as at 31st
March, 2018 is:

Liabilities ` Assets `
Creditors 70,000 Cash in Hand 80,000
Bills Payable 30,000 Cash at Bank 20,000
Workmen Compensation Reserve 20,000 Stock 75,000
General Reserve 80,000 Debtors 1,30,000
Capital A/cs: Less: Provision for Doubtful Debts 5,000 1,25,000
A 2,00,000 Motor Car 1,50,000
B 3,00,000 Investments 1,00,000
C 2,00,000 7,00,000 Plant and Machinery 1,20,000
Building 2,30,000
9,00,000 9,00,000

On 1st April, 2018, B retires from the firm selling his share of profit to A for ` 36,000 and to
C for ` 45,000 in the ratio of 4 : 5. For the purpose of B’s retirement, it was agreed that:

(i) Stock is to be appreciated by 20% and Building by 10%.
(ii) Motor Car is to be valued at ` 70,000.