Page 128 - AAAXII

Model Test Papers M.121

4. A’s share of goodwill adjusted through A’s Current Account, since question requires adjustment of capital on
the basis of A’s capital.
For writing-off Goodwill: ` `
B’s Capital A/c ...Dr. 50,000
C’s Capital A/c ...Dr. 30,000
A’s Current A/c ...Dr. 40,000
To Goodwill A/c 1,20,000
5. Dr. BANK ACCOUNT Cr.
Particulars ` Particulars `
To Balance b/d 50,000 By B’s Capital A/c 20,000
To A’s Capital A/c 3,00,000 By C’s Capital A/c 1,60,000
By Balance c/d 1,70,000
3,50,000 3,50,000
Or
Dr. REVALUATION ACCOUNT Cr.
Particulars ` Particulars `
To Furniture A/c 1,200 By Investments A/c 1,000
To Stock A/c 16,700 By Loss transferred to:
To Provision for Doubtful Debts A/c 7,000 A’s Capital A/c 11,950
B’s Capital A/c 7,170
C’s Capital A/c 4,780 23,900
24,900 24,900
Dr. PARTNERS’ CAPITAL ACCOUNTS Cr.
Particulars A (`) B (`) C (`) Particulars A (`) B (`) C (`)

To Revaluation A/c (Loss) 11,950 7,170 4,780 By Balance b/d 2,37,500 1,72,500 1,30,000
To Goodwill A/c ... 80,000 80,000 By Goodwill A/c (WN 1) 30,000 18,000 12,000
(Written-off) By A’s Loan A/c 8,000 ... ...
To Balance c/d (WN 2) 2,63,550 1,81,050 1,81,050 By Bank A/c ... 77,720 1,23,830
(Balancing Figure)
2,75,500 2,68,220 2,65,830 2,75,500 2,68,220 2,65,830

BALANCE SHEET OF B AND C
as at 1st April, 2018
Liabilities ` Assets `
Trade Creditors 58,000 Furniture 10,800
Bills Payable 59,000 Stock 1,50,300
A’s Account (Amount Due) 2,63,550 Debtors 2,80,000
Capital A/cs: Less: Provision for Doubtful Debts 14,000 2,66,000
B 1,81,050 Investments 50,000
C 1,81,050 3,62,100 Add: Appreciation 1,000 51,000
Cash in Hand 1,000
Cash at Bank 2,63,550
7,42,650 7,42,650