02 Jan 2021 6:13 pm
Practical Problems | Q 2 | Page 202
Rahul, Rohit, and Ramesh are in a business sharing profits and losses in the ratio of 3:2:1 respectively. Their balance sheet as on 31st March 2017 was as follows.
Balance Sheet as on 31st March 2017.
On 1st October 2017, Ramesh died and the Partnership deed provided that
1. R.D.D. was maintained at 5% on Debtors
2. Plant and Machinery and Investment were valued at ₹ 80,000 and ₹ 4,10,000 respectively.
3. Of the creditors, an item of ₹ 6000 was no longer a liability and hence was properly adjusted.
4. Profit for 2017-18 was estimated at ₹ 120,000 and Ramesh share in it up to the date of his death was given to him.
5. Goodwill of the Firm was valued at two times the average profit of the last five years. Which were
2012-13 | ₹ 1,80,000 |
2013-14 | ₹ 2,00,000 |
2014-15 | ₹ 2,50,000 |
2015-16 | ₹ 1,50,000 |
2016-17 | ₹ 1,20,000 |
Ramesh share in it was to be given to him
6. Salary 5,000 p.m. was payable to him
7. Interest on capital at 5% i.e. was payable and on Drawings ₹ 2000 were charged.
8. Drawings made by Ramesh up to September 2017 were ₹ 5,000 p.m.
Prepare
Ramesh’s Capital A/c showing the amount payable to his executors
Give Working of Profit and Goodwill
Ramesh Capital Balance ₹ 3,41,000