Learning Goal: I’m working on a accounting discussion question and need an expla

Learning Goal: I’m working on a accounting discussion question and need an explanation and answer to help me learn. The following is the trail Balance of X and Y Co. as on March 31, 2021. The partners sharing profits and losses in the ratio 2:1. Prepare the Income Statement, Profit & Loss Appropriation A/c, Partners’ Capital A/c and the Balance Sheet. Particulars Dr. Particulars Cr. Land and Buildings 525000 X Capital A/c 175000 Plant and Machinery 157500 Y Capital A/c 105000 Wages 70000 Sundry creditors 87500 Opening Stock of Finished Goods 140000 Sales (net) 1137500 Opening Stock of Raw material 70000 Discount 8750 Opening Stock of Work in Progress 63000 Provision for bad debts 5250 Sundry debtors 175000 Commission 35000 Carriage inwards 5250 Y’s Loan A/c 105000 Carriage outwards 3150 0 Factory Expenses 26250 0 Royalties 5250 0 Purchase of Raw material (net) 262500 0 Factory rent & taxes 22750 0 Discount 10150 0 Office rent 14000 0 Insurance 7000 0 Bad debts 5250 0 Office Expenses 26250 0 Salaries of works manager 42000 0 Cash at bank 28700 0 1659000 1659000 The following additional information is to be taken into consideration: Closing Stock: Finished Goods 175000 Raw Materials 105000 Work in Progress 87500 Outstanding Liabilities: 0 Wages 17500 Office Salaries 21000 Office Rent 7000 Partnership Salary: 0 X 21000 Y 10500 Insurance Premium paid in advance 1750 Provision for bad debts to be created @ 2.5% on debtors 0 Depreciate Land and Buildings by 2.5% and Plant and Machinery by 5%. 0 The loan account of Y was raised in the books before the beginning of the year. 0 Ahmed and Wahid are partners sharing profits and losses in the ratio of 3:1. Their Balance sheet as on March 31, 2021 is as follows. Liabilities Amount (RO) Assets Amount (RO) Creditors 135000 Cash 11250 Bills Payable 45000 Debtors 157500 General Reserve 90000 Stock 67500 Capital: 0 Plant 56250 Ahmed 180000 Buildings 225000 Wahid 90000 Profit & Loss Ac 22500 Bank Overdraft 135000 Equipment 135000 Total 675000 Total 675000 On April 01, 2021, they agreed to admit Khalid into the firm for 1/5th Share of future profits on the following terms: a) Building is revalued at 270000 b) Stock is revalued at 48375 c) Goodwill is raised at 90000 d) Provision for bad debts is to be made at 5% 0 e) Khalid has to bring in a Capital 112500 f) Khalid was unable to bring the amount of goodwill Pass Journal Entries and Prepare Revaluation Account, Capital Accounts and the Balance Sheet of the reconstituted firm. Lalitha, Jothi and Kanaga were partners of a firm sharing profit and losses in the ratio of 3:2:3. Set out below was their balance sheet as onMarch 31, 2021. Liabilities & Equity RO Assets RO Bills Payable 80000 Cash in Hand 1875 Sundry Creditors 156250 Cash at Bank 511250 Outstanding Expenses 1250 Debtors 222500 Capital: 0 Stock 278750 Lalitha 500000 Furniture 43750 Jothi 312500 Plant and Machinery 121875 Kanaga 375000 Building 300000 Profits & Loss A/c 55000 0 1480000 1480000 Lalitha retired from the partnership on April 01, 2021 under the following terms: The assets are to be valued as under: Stock 250000 Furniture 37500 Plant & Machinery 112500 Building 250000 A provision for doubtful debt to be created at 10625 Goodwill of the firm was to be valued at 75000 The gaining ratio is 2:3. Lalitha was to be paid off immediately. Record the necessary journal entries, prepare Revaluation Account, Capital Accounts and Balance Sheet of the reconstituted partnership.

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