Ram, Mohan and Sohan were partners sharing profits and losses in the ratio of 5 : 3 : 2. On 31st March, 2025, their Balance Sheet was:
Ram, Mohan and Sohan were partners sharing profits and losses in the ratio of 5 : 3 : 2. On 31st March, 2025, their Balance Sheet was:
Sohan died on 1st August, 2025. It was agreed that:
(i) Goodwill of the firm is to be valued at ₹ 1,75,000.
(ii) Machinery be valued at ₹ 1,40,000; Patents at ₹ 40,000; Land at ₹ 1,50,000 on this date.
(iii) For the purpose of calculating Sohan’s share in the profits of the year of death, profits should be taken to have accrued on the same scale as in previous year, which were ₹ 75,000.
Prepare Revaluation Account and Sohan’s Capital Account.
[Ans.: Profit on Revaluation – ₹ 25,000; Sohan’s share of Goodwill – ₹ 35,000; Sohan’s share of profit – ₹ 5,000; Amount payable to Sohan’s Executor’s – ₹ 1,26,000.]
| Liabilities | ₹ | Assets | ₹ |
| Ram Mohan Sohan | 1,50,000 1,25,000 75,000 | Land | 1,25,000 |
| Sundry Creditors | 1,55,000 | Patents | 30,000 |
| Workmen’s Compensation Reserve | 30,000 | Machinery | 1,50,000 |
| Stock | 1,90,000 | ||
| Cash at Bank | 40,000 | ||
| 5,35,000 | 5,35,000 |
Anurag Pathak Answered question
