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Model Test Papers M.167

Working Notes:
1. Calculation of Money Received on Allotment:
(i) Pro rata allotment = 6,00,000 : 5,00,000 or 6 : 5
(ii) Number of shares allotted to Giri = 5/6 × 12,000 = 10,000 shares `
(iii) Money received on application from Giri (12,000 shares × ` 5) 60,000
Less: Amount adjusted on application (10,000 × ` 5) 50,000
Excess application money adjusted on allotment 10,000
(iv) Money due from Giri on Allotment:
Money due on allotment (10,000 × ` 4) 40,000
Less: Excess application money adjusted [as per (iii)] 10,000
Money not paid by Giri 30,000
(v) Money Received on Allotment:
Total amount due on allotment 20,00,000
Less: Excess application money adjusted 5,00,000
15,00,000
Less: Money not paid by Giri [as per (iv)] 30,000
Money Received on Allotment 14,70,000
2. Calculation of amount transferred to Capital Reserve: `
Amount forfeited on 5,000 shares (` 40,000 × 1/2) 20,000
Less: Discount on reissue 10,000
Gain (Profit) on reissue transferred to Capital Reserve 10,000

17. JOURNAL
Date Particulars L.F. Dr. (`) Cr. (`)
2018
April 1 Bank A/c ...Dr. 3,00,000
To Z’s Capital A/c 2,00,000
To Premium for Goodwill A/c 1,00,000
(Being the capital and premium for goodwill brought in by Z)
April 1 Premium for Goodwill A/c ...Dr. 1,00,000
To X’s Capital A/c 75,000
To Y’s Capital A/c 25,000
(Being the goodwill amount brought in by Z credited to X and Y in
their sacrificing ratio, i.e., 3 : 1 or 1/8 : 1/24)
April 1 X’s Capital A/c ...Dr. 60,000
Y’s Capital A/c ...Dr. 40,000
To Goodwill A/c 1,00,000
(Being the existing goodwill written off between old partners)
April 1 Revaluation A/c ...Dr. 40,000
To Machinery A/c [` 1,00,000 – (90% of ` 1,00,000)] 10,000
To Investment A/c (` 1,10,000 – ` 80,000) 30,000
(Being the assets revalued downwards on Z’s admission)
April 1 Land and Building A/c (` 4,00,000 × 50/100) ...Dr. 2,00,000
To Revaluation A/c 2,00,000
(Being the land and building revalued upwards by
50% on Z’s admission)
April 1 Revaluation A/c ...Dr. 1,60,000
To X’s Capital A/c 96,000
To Y’s Capital A/c 64,000
(Being the gain (profit) on revaluation credited to X and Y in their
old profit-sharing ratio)