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M.154 An Aid to Accountancy—CBSE XII

Or
Puneet, Pankaj and Pawan are partners in a business sharing profits and losses in
the ratio of 2 : 2 : 1 respectively. Their Balance Sheet as at 31st March, 2017 was
as follows:
BALANCE SHEET as at 31st March, 2017
Liabilities ` Assets `
Sundry Creditors 2,00,000 Cash at Bank 40,000
Reserve 1,00,000 Stock 60,000
Capital A/cs: Sundry Debtors 1,60,000
Puneet 1,20,000 Investments 1,40,000
Pankaj 2,00,000 Furniture 70,000
Pawan 80,000 4,00,000 Building 2,30,000
7,00,000 7,00,000
Pawan died on 30th September, 2017. The Partnership Deed provided following:
(i) Deceased partner will be entitled to his share of profit up to the date of death
calculated on the basis of previous year’s profit.
(ii) He will be entitled to his share of goodwill of the firm calculated on the basis of
3 years’ purchase of average of last 4 years’ profit.
Profits for the last four financial years are: for 2013–14: ` 1,60,000; for 2014–15:
` 1,00,000; for 2015–16: ` 80,000; for 2016–17: ` 60,000.

(iii) Drawings of the deceased partner up to the date of death amounted to ` 20,000.
(iv) Interest on capital is to be allowed at 12% per annum.
Continuing partners agreed that ` 30,800 will paid to the executor immediately and
the balance in two equal yearly instalments starting from 30th September, 2018 with
interest @ 12% p.a. on outstanding balance. Show Pawan’s Capital Account and his
Executor’s Account till the settlement of the amount due. (8)

PART B
ANALYSIS OF FINANCIAL STATEMENTS

18. When is dividend received considered as Operating Activity? (1)
19. State with reason whether old furniture written off would result in Inflow, Outflow or
No Flow of Cash or Cash Equivalents. (1)
20. Under which heads and sub-heads following items will be shown in the Balance Sheet
of a company as per Schedule III to the Companies Act, 2013:
(i) Calls-in-Advance and Interest thereon;
(ii) Investment in Property;
(iii) Advance Tax; and

(iv) Mining Rights? (4)
21. (a) State any two objectives of Common-size Balance Sheet.