Suraj and Chetan are partners in a firm sharing profits and losses equally. They decide to take Deep into partnership from 1st April, 2023 for 1/5th share in the future profits
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Calculate the value Goodwill on the basis of three year’s purchase of four year’s average profit. Profits of the firm for last four year’s ending on 31st March, were: 2020 – ₹ 12,000; 2021 – ₹ 18,000; 2022 – ₹ 16,000; 2023 – ₹14,000. Calculate the value of Goodwill.
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Amit, Bunty and Charan are partners sharing profits and losses in the ratio of 2 : 2 : 1. Charan retired on 30th June, 2023. The Balance Sheet of the firm on 31st March, 2023 was as follows:
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The Partnership Deed of Aman, Bharat and Chetan has a clause that any partner may retire from the firm on the following terms by giving six months’ notice in writing. The retiring partner shall be paid: a) The amount standing to the credit of his Capital Account and Current Account. b) His share of profit to the date of retirement, calculated on the basis of the average profit of the three preceding completed years, if he retires in between the year. c) His share of Goodwill of the firm calculated on the basis of 1 and half times the average profit of the three preceding completed years. d) Assets shall be revalued and liabilities re-assessed. Retiring partner will get his share in the gain (profit) and will bear loss, if any. Chetan gave notice on 31st March, 2022 to retire with effect from 30th September 2022. On that date, the balance of his capital was ₹ 1,60,000 and his Current Account (in debit) ₹ 5,000. The profits for the three preceding completed years were: I – ₹ 45,000; II – ₹ 30,000, III – ₹ 24,000. Revaluation of assets and reassessment of liabilities resulted in neither gain (profit) nor loss. What amount is due to Chetan in accordance with the partnership agreement? [Ans.: Amount due to Chetan = ₹ 1,77,000. Amount transferred from Chetan’s Current A/c to Chetan’s Capital A/c after adjustment – ₹ 17,000.]
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Yogesh, Naresh and Pavesh were partners in a firm sharing profits in the ratio of 2 : 2 : 1. Naresh retired on 1st October, 2022. In terms of the Partnership Deed, financial statements were prepared as on date of retirement and profit was determined as ₹ 7,20,000. a) Pass the Journal entries for distribution of profit for the period. b) Pass the Journal entries if loss of ₹ 3,60,000 was incurred.
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Amar, Bhuvi and Charan were partners in a firm sharing profits equally. Bhuvi retired on 30th September, 2022. Profit or loss till the date of retirement was to be estimated based on last year’s profit. Loss for the year ended 31st March, 2022 was ₹ 1,80,000. Calculate Bhuvi’s share of loss till her retirement and pass Journal entry/entries for the same when: i) The profit sharing ratio between Amar and Charan does not change; and ii) The new profit sharing ratio between Amar and Charan changes to 3 : 2.
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Amrit, Bhanu and Charu were partners in a firm sharing profits equally. Bhanu retired on 30th September, 2022. Profit till the date of retirement was to be estimated based on last year’s profit. Profit for the year ended 31st March, 2022, was ₹ 3,60,000. Calculate Bhanu’s share of profit till his retirement and pass Journal entry/entries for the same when: i) The profit sharing ratio between Amrit and Charu does not change; and ii) The new profit sharing ratio between Amrit and Charu changes to 3 : 2. [Ans.: i) Dr Profit & Loss Suspense A/c by ₹ 60,000 and Cr. Bhanu’s Capital A/c by ₹ 60,000. ii) Dr. Amrit’s Capital A/c by ₹ 48,000 and Charu’s Capital A/c by ₹ 12,000; Cr. Bhanu’s Capital A/c by ₹ 60,000.]
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The Balance Sheet of Asha, Deepa and Lata who were sharing profits in the ratio of 5 : 3 : 2 as at 31st March, 2023 is as follows:
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Suraj, Pawan and Kamal are partners in a firm sharing profits and losses in the ratio of 3 : 2 : 1. Their Balance Sheet as at 31st March, 2023 is:
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Sushil, Satish and Samir are partners sharing profits in the ratio of 5 : 3 : 2. Satish retires on 1st April, 2023 from the firm, on which date capitals of Sushil, Satish and Samir after all adjustments are ₹ 1,03,680, ₹ 87,840 and ₹ 26,880 respectively. The Cash and Bank Balance on that date was ₹ 9,600. Satish is to be paid through amount brought by Sushil and Samir in such a way as to make their capitals proportionate to their new profit sharing ratio which will be Sushil 3/5 and Samir 2/5. Calculate the amount to be paid or to be brought by the continuing partners if minimum Cash and Bank balance of ₹ 7,200 was to be maintained and pass the necessary Journal entries. [Ans.: Sushil and Samir will bring ₹ 25,920 and ₹ 59,520 respectively]
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