Page 223 - AAAXII

M.212 An Aid to Accountancy—CBSE XII

Combined Capital of Ram and Shyam for 5/6 share = ` 5,00,000

Combined capital of old partners
Total Capital of the New Firm =
Combined share of profit of the old partners
= ` 5,00,000 × 6/5 = ` 6,00,000
Mohan’s Capital in the New Firm = ` 6,00,000 × 1/6 = ` 1,00,000.
6. (i) His share of loss on revaluation of assets and reassessment of liabilities.
(ii) His share of existing goodwill written off.
7. Calculation of Sacrifice or Gain of Partners:
Sacrifice/(Gain) = Old Share – New Share
3 2 1
X = – = (Sacrifice)
6 6 6

2 3 1
Y = – = – (Gain)
6 6 6
1 1
Z = – = Nil
6 6
Thus, X is sacrificing partner and Y is gaining partner.
Calculation of Average Profit:
Compensation payable by Y to X for 1/6th share = ` 2,00,000.
Firm’s Goodwill = ` 2,00,000 × 6/1 = ` 12,00,000.
Goodwill = Average Profit × Number of Years’ Purchase
` 12,00,000 = Average Profit × 3
Average Profit = ` 12,00,000/3 = ` 4,00,000.
Calculation of Profit for the year 2013–14:
Let the Profit for the year 2013–14 = P

+ 6,00,000 + 6,80,000 + 7,60,000 – 2,80,000P ` ` ` `
` 4,00,000 =
5
Hence, P = ` 2,40,000 (Profit for the year 2013–14).
8. (a) Interest on Debentures is a charge against the profits of the company and is
payable irrespective of whether the company earns profit or not.
(b) Dr. FORFEITED SHARES ACCOUNT Cr.
Particulars ` Particulars `
To Share Capital A/c 2,000 By Share Capital A/c 15,000
(Discount on reissue of 200 Shares) (Amount forfeited on 500 Shares)
To Capital Reserve A/c 4,000
To Balance c/d 9,000
15,000 15,000

Notes: 1. Capital Reserve = (` 15,000 × 200/500) – ` 2,000 (Discount on reissue) = ` 4,000.
2. Balance of Forfeited Shares A/c = ` 15,000 × 300/500 = ` 9,000.