Question : A, B and C are partners in a firm sharing profits and losses in the ratio of 3: 2: 1. D is admitted as a new partner for 1/4 share in the profits of the firm, which he gets 1/8 from A, and 1/16 each from B and C. The total capital of the new firm after D's admission will be Rs. 2,40,000. D is required to bring in cash equal to 1/4 of the total capital of the new firm. The capitals of the old partners also have to be adjusted in proportion of their profit sharing ratio. The capitals of A, B and C after all adjustments in respect of goodwill and revaluation of assets and liabilities have been made are A Rs. 80,000 , B Rs. 30,000 and C Rs. 28,000 . Calculate the capitals of all the partners and record the necessary journal entries for doing adjustments in respect of capitals according to the agreement between the partners.
Option 1: A will bring Rs 10,000 , B brings Rs 35,000 and C withdrawn 3000
Option 2: A will bring Rs 10,000 and B withdrew Rs 35,000 and C bring Rs 3,000
Option 3: A bring Rs 10,000 and B withdrew Rs 35,000 and C withdrew Rs 3,000
Option 4: None of the above
Correct Answer: A will bring Rs 10,000 , B brings Rs 35,000 and C withdrawn 3000
Solution : Answer = A will bring Rs 10,000 , B brings Rs 35,000 and C withdrawn 3000
A = $\frac{3}{6} - \frac{1}{8} of \frac{2}{16} = \frac{3}{6}-\frac{2}{16} = \frac{48-12}{96} = \frac{36}{96}\times 2,40,000 = 90,000$
B = $\frac{2}{6} - \frac{1}{16} = \frac{32-6}{96} = \frac{26}{96}\times 2,40,000 = 65,000$
C = $\frac{1}{6} - \frac{1}{16} = \frac{16-6}{96} = \frac{10}{96}\times 2,40,000 = 25,000$
D = \frac{1}{6}\times 2,40,000 = 60,000$
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Bank A/c Dr 45000
To A's Capital A/c 10,000
To B's Capital A/c 35000
C's Capital A/c Dr 3000
To Bank - 3000 Hence, the correct option is 1.
Question : A and B are partners in a firm sharing profits in the ratio of 7: 5. On April 1,2017 they admit $C$ as a new partner for $\frac{1}{6}$ th share. The new ratio will be 13:7:4.
C contributed the following assets towards his capital and for his share of goodwill : Stock Rs.60,000; Debtors Rs.80,000; Land Rs.2,00,000; Plant and Machinery Rs. 1,20,000. On the date of admission of $C$, the goodwill of the firm was valued at Rs. 7,50,000 The amount of capital contributed by the new partner will be----
Option 1: Rs 4,60,000
Option 2: Rs 3,35,000
Option 3: Rs 4,00,000
Option 4: Rs 4,50,000
Question : Krishna and Suresh were partners in a firm sharing profits in the ratio of 3: 1. With a capital of Rs 3,00,000 and Rs 2,00,000. On 1st April, 2015 they admitted Rahul as a new partner for 1/5 th share in profits of the firm. On the date of Rahul's admission the Balance Sheet of Krishna and Suresh showed a General Reserve of Rs. 1,20,000, a debit balance of Rs.60,000 in Profit and Loss A/c and Workmen Compensation Reserve of Rs. 1,50,000. The following was agreed upon on Rahul's admission : (i) Rahul will bring Rs. 1,50,000 as his capital and his share of goodwill premium in cash. (ii) Goodwill of the firm be valued at Rs.2,40,000. (iii) There was a claim of Workmen Compensation for Rs. 1,70,000, (iii) The partners decided to share future profits in the ratio of 3: 1: 1. The balance of partners capital after all adjustment and after admitted new partners will be
Option 1: Krishna's capital Rs 3,66,000 and Suresh 2,22,000 and Rahul Rs 1,50,000
Option 2: Krishna's capital account Rs 3,06,000 and Suresh Rs 2,02,000 Rahul Rs 1,50,000
Option 3: K's capital Rs 4,26,000 and Suresh Rs 3,42,000 and Rahul Rs 1,50,000
Question : Hari and Kavi are partners sharing profits and losses in the ratio of 3: 2. They admit Ravi as a partner who contributes Rs. 30,000 as his capital for 1/5th share in the profits of the firm. It is decided that after Ravi's admission, the capitals of the Hari and Kavi will be adjusted on the basis of Ravi's share of capital in the business, and any surplus or deficiency to be adjusted through current accounts. Before any adjustments were made, the capitals of Hari and Kavi were: Rs. 59,000 and Rs. 35,000 respectively. At the time of Ravi's admission : (a) The firm's goodwill was valued at Rs. 40,000. (b) General Reserve was Rs.25,000. (c) Loss on revaluation of assets and liabilities was Rs.4,000. CHOOSE: The correct Journal entry for surplus and shortage
Option 1: Crediting Hari's current account by Rs 4,400 and debiting Kavi's current account Rs 1,400
Option 2: Debiting Hari's current account by Rs 4,400 and crediting Kavi's current account Rs 1,400
Option 3: Debiting Hari's current account Rs 4,400 and debiting Kavis current account Rs 1,400
Option 4: Crediting Hari's Current account Rs 4,400 and Crediting Kavi's current account Rs 1,400
Question : Cake and Muffin are partners sharing profits and losses in the ratio of 5: 4. On 1st April, 2016, they admit Cookie as a new partner for 1/6th share in the profits of the firm and the new ratio agreed upon is 3: 2: 1.
Goodwill, at the time of Cookie's admission is to be valued on the basis of capitalisation of the average profits of the last three years. Profits for the last three years were : Year ended 31st March, 2014 Rs.39,000 (including an abnormal loss of Rs. 9,000). Year ended 31st March, 2015 Rs.83,000 (including an abnormal gain of Rs.8,000). Year ended 31st March, 2016 Rs.72,000. On 1st April, 2016, the firm had assets of Rs.8,00,000. Its creditors amounted to Rs.3,60,000. The firm had a Reserve Fund of Rs. 40,000 while Partners' Capital Accounts showed a balance of Rs.4,00,000. The normal rate of return expected from this class of business is 13%. Cookie brings in Rs.2,00,000 for her capital but is unable to bring in cash for her share of goodwill.
The amount of cookie brought his share of goodwill will be .....
Option 1: Rs 60,000
Option 2: Rs 50,000
Option 3: Rs 10,000
Question : Which of the following is not true with respect to Admission of a partner?
Option 1: A new partner can be admitted if it is agreed in the partnership deed.
Option 2: If all the partners agree, a new partner can be admitted.
Option 3: A new partner has to bring relatively higher capital as compared to the existing partners.
Option 4: A new partner gets right in the assets of the firm.
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