Ajay Chaudhary Classes

-Being Brilliant
Q1. Anita, Babita and Chanderkala are partners in a firm. Anita retires and the Balance Sheet of
this firm on that data is as under:

Liabilities () Assets ()
Creditors 4,000 Cash at Bank 6,000
Reserve 4,500 Debtors 16,000
Workmens Compensation Fund 5,000 Furniture 15,000
Profit and Loss Account 2,500 Plant 20,000
Capitals: Patents 4,000
Anita 20,000
Babita 15,000
Chanderkala 10,000 45,000
61,000 61,000
On retirement it was found that patents were valueless, furniture is to be brought down
12,000 and plant is reduced by 5,000 and there was a liability on account of workmens
compensation fund 3,000. Record necessary entries at the time of retirement.
1 1
Q2. Amit, Balan and Chander were partners in a firm sharing profits in the proportion of , and
2 3
1
respectively. Chander retired on 1st April, 2014. The Balance Sheet of the firm on the date of
6
Chanders retirement was as follows:

Balance Sheet of Amit, Balan and Chander

as at 1st April, 2014

Liabilities Amount Assets Amount

() ()
Sundry Creditors 12,600 Bank 4,100
Provident Fund 3,000 Debtors 30,000
General Reserve 9,000 Less: Provision 1,000 29,000
Capitals: Stock 25,000
Amit 40,000 Investments 10,000
Balan 36,000 Patents 5,000
Chander 20,000 96,500 Machinery 48,000
1,21,000 1,21,000
It was agreed that:
(a) Goodwill will be valued at 27,000.
(b) Depreciation of 10% was to be provided on machinery.
(c) patents were to be reduced by 20%.
(d) Liability on account of provident Fund was estimated at 2,400.
(e) Chander took over investment for 15,800.
(f) Amit and Balan decided to adjust their capitals in proportion of their profit-sharing ratio by
opening current accounts.