Solution of The Asignment of Slow Learners

Questions for the weak students
Solution
1. Solution :-
Particulars 2021-22(Rs.) %age 2022-23(Rs.) %age
Revenue from Operations 4,00,000 100 6,00,000 100
Other Income 1,00,000 25 1,50,000 25
Total Revenue 5,00,000 125 7,50,000 125
Employees Benefit Expenses 80,000 20 1,80,000 30
Finance Cost 50,000 12.5 60,000 10
Total Expense 1,30,000 32.5 2,40,000 40
Profit before tax (T.R. – T.E.) 3,70,000 92.5 5,10,000 85
Tax 1,85,000 46.25 2,55,000 42.5
Profit after tax 1,85,000 46.25 2,55,000 42.5
2. Solution:-
Particulars 2021-22(Rs.) 2022-23(Rs.) Absolute % age

change
(Rs.)
Revenue from Operations 24,00,000 25,00,000 1,00,000 4.17
Total Revenue 24,00,000 25,00,000 1,00,000 4.17
Cost of revenue from 8,00,000 10,00,000 2,00,000 25

operations
3,60,000 2,50,000 (1,10,000) 30.55
Other Expense
11,60,000 12,50,000 90,000 7.75
Total Expense
12,40,000 12,50,000 10,000 0.81
Profit before tax (T.R. –
6,20,000 6,25,000 5,000 0.81
T.E.)
6,20,000 6,25,000 5,000 0.81
Tax
Profit after tax
3. Solution:-
Date Particulars l/f Debit (Rs.) Credit(Rs.)
1. Cash Account-------------------------- 5,00,000
---------Dr.
4,00,000
To Z’s Capital Account
1,00,000
To Premium for Goodwill
Account
2. Premium for Goodwill Account--- 1,00,000

----------Dr.
1,00,000
To X’s Capital Account
3. X’s Capital Account------------------ 36,000

---------Dr.
24,000
Y’s Capital Account------------------
60,000
---------Dr.
To Goodwill Account
4. Solution:-
1. Cash Account-------------------------- 2,60,000

---------Dr.
2,00,000
To C’s Capital Account
60,000
To Premium for Goodwill
Account
2. Premium for Goodwill Account--- 60,000

----------Dr.
60,000
To A’s Capital Account
3. A’s Capital Account------------------ 30,000

---------Dr.
10,000
B’s Capital Account------------------
40,000
---------Dr.
To Goodwill Account
A’s Sacrifice :- 3/5 – 2/5 :- 1/5

B’s Sacrifice :- 2/5- 2/5 :- nil
Note :- No need to calculate sacrifice ratio, if new ratio is not given. Old ratio will
be treated as Sacrifice Ratio.
5. Solution:-
1. X’s Capital Account------------------- 40,000
---------Dr.
40,000
Y’s Capital Account-------------------
80,000
---------Dr.
2. X’s Capital Account------------------- 40,000

--------Dr.
30,000
Y’s Capital Account-------------------
20,000
--------Dr.
90,000
Z’s Capital Account-------------------
--------Dr.
To Goodwill Account
Share of goodwill of Z:- 3,60,000*2/9 :- 80,000
6. Solution:-
1. P’s Capital Account------------------- 80,000

---------Dr.
80,000
To R’s Capital Account
2. P’s Capital Account------------------- 50,000

--------Dr.
30,000
Q’s Capital Account-------------------
20,000
--------Dr.
1,00,000
R’s Capital Account-------------------
--------Dr.
To Goodwill Account
Share of goodwill of R :- 4,00,000*2/10 :- 80,000
7. Solution :-
Average Profit :- 4,00,000+3,00,000+4,50,000+3,50,000 / 4 :- Rs.3,75,000
Share of profit of Z :- 3,75,000*2/8*5/12 :- Rs.78,125
1. Profit & Loss Suspense Account - 78,125

---------Dr.
78,125
8. Solution :-
Share of profit of A :- (3,00,000/10,00,000*4,00,000) * 1/3 :- Rs.40,000
1. Profit & Loss Suspense Account - 40,000

---------Dr.
40,000
To A’s Capital Account
9. Solution :-
Share of profit of Ram :- 2,50,000 * 2/10 * 7/12 :- Rs.29,167
Average Profits :- 4,00,000+3,00,000+2,00,000+3,00,000+2,50,000/5 :- Rs.2,90,000
Goodwill of the firm :- 2,90,000 * 3 :- Rs.8,70,000
Share of Goodwill of Ram:- 8,70,000 * 2/10 :- 1,74,000
1. Profit & Loss Suspense Account 29,167

----------Dr.
29,167
To Ram’s Capital Account
2. Shyam’s Capital Account----------- 65,250

----------Dr.
1,08,750
Gopal’s Capital Account------------
1,74,000
----------Dr.
To Ram’s Capital Account
10. Solution:-

---------Dr.
38,000
To Realisation Account
2. Realisation Account------------------ 1,00,000

---------Dr.
1,00,000
To Bank Account
3. Realisation Account------------------ 80,000

---------Dr.
80,000
4. No Entry
5. Bank Account-------------------------- 12,000

-------Dr.
To Realisation account 12,000
6. Realisation Account------------------ 9,000

---------Dr.
9,000
To Y’s Capital Account
7. Bank Account-------------------------- 2,00,000

-------Dr.
2,00,000
To Realisation account
8. Profit & Loss Account--------------- 40,000

-------Dr.
16,000
24,000
To Y’s Capital Account

----------Dr.
6,000
Y’s Capital Account------------------
----------Dr. 10,000
To Realisation Account
10. Bank Account-------------------------- 13,000

-------Dr.
13,000
To Realisation account
11. Solution :-
Goodwill :- (1,00,000-10,000) * 3 :-Rs.2,70,000
12. Solution :
Average Profits :- 2,00,000+3,00,000+1,00,000 / 3 :-Rs.2,00,000
Capital Employed :- Total Assets – Creditors
:- 10,00,000 – 1,50,000 :- Rs.8,50,000
Normal Profit :- 8,50,000 * 15% :- Rs.1,27,500
Super Profit :- 2,00,000 - 1,27,500 :- Rs.72,500
Goodwill :- 72,500*3 :-Rs.2,17,500
13. Solution :-
Average Profits :- (4,00,000-50,000)+(2,50,000+1,00,000)+2,00,000/ 3 :-
Rs.3,00,000
Goodwill :- 3,00,000*2 :- Rs.6,00,000
14. Solution :-
Average Profit :- 3,00,000+2,50,000+2,00,000 / 3 :-Rs.2,50,000
Capital Employed :- 10,00,000 – 1,50,000 :- Rs.8,50,000
Normal Profit :- 8,50,000 * 10% :-Rs.85,000
Super Profit :- 2,50,000- 85,000 :- Rs.1,65,000
Goodwill :- 1,65,000 * 100/10 :-Rs.16,50,000
15. Solution:-
X’s Share :- 5/10 – 2/5 :- 1/10*6,50,000 :- Rs.65,000
Y’s Share :- 3/10 – 2/5 :- -1/10*6,50,000 :- (Rs.65,000)
Z’s Share :- 2/10 – 1/5 :- nil
Net Amount :-4,00,000 +1,00,000 +1,50,000:- Rs.6,50,000
Solution:-
1. Y’s Capital Account------------------- 65,000

---------Dr.
65,000
16. Solution :-
A’s Share :- 2/5 – 1/3 :- 1/15*1,20,000 :- Rs.8,000
B’s Share :- 2/5 – 1/3 :- 1/15*1,20,000 :- Rs.8,000
C’s Share :- 1/5 – 1/3 :--2/15*1,20,000 :- (Rs.16,000)
Net Amount :-1,50,000 -1,00,000 -1,70,000:- Rs.(1,20,000)
1. A’s Capital Account------------------- 8,000

---------Dr.
8,000
B’s Capital Account-------------------
16,000
---------Dr.
To C’s Capital Account
17. Solution:
X’s Share :- 3/5 – 2/3 :- -1/15*1,50,000 :- Rs.(10,000)
Y’s Share :- 2/5 – 1/3 :- 1/15*1,50,000 :- Rs.10,000
1. Y’s Capital Account------------------- 10,000

---------Dr.
10,000
18. Solution:-
1. Share Capital Account---------------- 2,00,000
------- Dr.
1,00,000
To Share Allotment
40,000
Account(2000*50)
20,000
To Share First Call
Account(2000*20) 40,000
To Share Final Call
Account(2000*10)
To Share forfeited
Account(2000*20)
2. Bank Account---------------------- 1,02,000

Dr.(1200*85)
18,000
Share Forfeited Account-------Dr.
1,20,000
(1200*15)
To Share Capital
Account(1200*100)
3. Share Forfeited Account------------- 6,000

---------Dr.
6,000
To Capital Reserve Account
(20-15) * 1,200
19. Solution :-
1. Share Capital Account---------------- 3,20,000

------- Dr.
2,00,000
To Share Allotment
60,000
Account(4000*50)
60,000
To Share First Call
Account(4000*15)
To Share forfeited
Account(4000*15)
2. Bank Account---------------------- 1,96,000

Dr.(2800*70)
28,000
Share Forfeited Account-------Dr.
2,24,000
.(2800*10)
To Share Capital
Account.(2800*80)

---------Dr.
14,000
(15-10) * 2,800
20. Solution :-
1. Share Capital Account---------------- 42,000

------- Dr.
12,000
Securities Premium Account--------
36,000
--------Dr.
18,000
To Share Allotment
Account(6000*6)
To Share forfeited
Account(6000*3)
2. Bank Account---------------------- 33,600

Dr.(4200*8)
29,400
To Share Capital
4,200
Account.(4200*7)
To Securities Premium
Account(4200*1)

---------Dr.
12,600
(3-0) * 4,200
21. Solution :-
1. Share Capital Account---------------- 2,000

------- Dr.
200
Securities Premium Account--------
1,400
--------Dr.
800
To Calls in Arrears
Account(200*7)
To Share forfeited
Account(200*4)
2. Bank Account---------------------- 1,560

Dr.(120*13)
1,200
To Share Capital
360
Account.(120*10)
Account(120*3)
3. Share Forfeited Account-------------- 480

--------Dr.
480
(4-0) * 120
22. Solution:-
1. Assets Account-------------------------- 15,00,000

--------Dr.
3,00,000
To Liabilities
10,00,000
To Y ltd. Account
2,00,000
2. Y ltd. Account--------------------------- 10,00,000

--------Dr.
4,00,000
To Bank Account(40% of 10
5,00,000
lakh)
1,00,000
To Share Capital
Account(50,000*10)
Account(50000*2)
No. of shares :- 10,00,000 -4,00,000/ 10+2(20% of 10)

:- 6,00,000 / 12 :- 50,000 shares
23. Solution:-
1. Assets Account-------------------------- 12,50,000

--------Dr.
2,50,000
To Liabilities
10,00,000
To Pankaj ltd. Account
2. Pankaj ltd. Account------------------- 10,00,000
---------Dr.
3,00,000
5,60,000
lakh)
1,40,000
To 10% Preference Share
Capital
Account(5,600*25)
No. of shares :- 10,00,000 -3,00,000/ 100+25(25% of 100)

:- 7,00,000 / 125 :- 4,800 shares
24. Solution :-
1. Machinery Account-------------------- 18,00,000

--------Dr.
18,00,000
To Kapil ltd. Account
2. Kapil ltd. Account---------------------- 18,00,000

------Dr.
1,50,000
Discount on issue of deb. Account-
4,50,000
-----Dr.
15,00,000
lakh)
To 10% Debentures
Account(15000*100)
No. of debetures:- 18,00,000 -4,50,000/ 100-10(10% of 100)

:- 13,50,000 / 90 :- 15,000 shares
25. Solution :-
1. Plant Account--------------------------- 4,00,000

--------Dr.
6,00,000
Machinery Account--------------------
3,00,000
--------Dr.
1,50,000
Inventory Account---------------------
--------Dr. 3,00,000
Debtors Account------------------------ 2,50,000 2,00,000
--------Dr.
18,00,000
Furniture Account---------------------
--------Dr.
Goodwill Account(b/f)-----------------
--------Dr.
To Creditors Account
To RK ltd. Account
2. RK ltd. Account------------------------- 18,00,000

---Dr.
18,00,000
To 10% Debentures
Account(18000*100)
No. of debentures :- 18,00,000 / 100:- 18,000
26. Solution :-
Date Particulars l/f Debit Credit(Rs.)

(Rs.)
1. Bank Account--------------------------- 11,00,000

Dr.(10,00,000 + 1,00,000)
11,00,000
To Deb. App. & All. Account
2. Deb. App. & All. Account -------------------------- 11,00,000

--Dr.
80,000
Loss on issue of debentures Account------
10,00,000
Dr.(10,00,000*8%)
1,00,000
To 10% Debentures
80,000
Account(10000*100)
Account(10% of 10 lakh)
To Premium on redemption
3. Securities Premium Account---------------------- 80,000

----------------Dr.
80,000
To Loss on issue of Debentures
Account
27. Solution :-

(Rs.)
1. Bank Account--------------------------- 10,60,000

Dr.(10,00,000 + 60,000)
10,60,000

--Dr.
10,00,000
To 10% Debentures Account 60,000
To Securities Premium Account(6%

of 10 lakh)
28. Solution :-

(Rs.)
1. Bank Account--------------------------- 3,24,000

Dr.(3,60,000 – 36,000)
3,24,000
2. Deb. App. & All. Account --------------------------- 3,24,000

-Dr.
36,000
Discount on issue of debentures Account---
21,600 3,60,000
Dr.(3,60,000*10%)
21,600
Loss on issue of deb. Account-----------------Dr.
To 10% Debentures
Account(6000*60)
Account(6% of 3.6 lakh)
3. Statement of Profit and Loss---------------------- 57,600

----------------Dr.
36,000
21,600
Account
To Discount on issue of Debentures

Account
29. Solution :-

(Rs.)
1. Bank Account--------------------------- 3,36,000
Dr.(3,50,000 – 14,000)
3,36,000
2. Deb. App. & All. Account --------------------------- 3,36,000

-Dr.
14,000
Discount on issue of debentures Account---
3,50,000
Dr.(3,50,000*4%)
To 10% Debentures
Account(7000*50)
3. Statement of Profit and Loss---------------------- 14,000

----------------Dr.
14,000
To Discount on issue of
Debentures Account
30. Solution :-

(Rs.)
1. Bank Account---------------------------Dr. 10,00,000
To Deb. App. & All. Account 10,00,000

--Dr.
10,00,000
To 10% Debentures
Account(10,000*100)
31. Solution :-

(Rs.)
1st Bank Account--------------------------- 9,00,000

April Dr.(10,00,000 – 1,00,000)
9,00,000
1st Deb. App. & All. Account ------------------------ 9,00,000

April ----Dr.
1,00,000
Discount on issue of debentures Account-
60,000
Dr.(10,00,000*10%)
10,00,000
Loss on issue of deb. Account-----------------
Dr. (10,00,000*6%) 60,000
To 10% Debentures
Account(10,000*100)
30th Debentures Interest Account ------------------- 50,000

Sept. ------------------Dr.
50,000
To Debenture holder
(10,00,000*10%*6/12)
30th Debenture holder ---------------------------------- 50,000

Sept. ------------------Dr.
50,000
To Bank Account
31st Debentures Interest Account ------------------- 50,000

March ------------------Dr.
50,000
To Debenture holder
(10,00,000*10%*6/12)
31st Debenture holder ---------------------------------- 50,000

March ------------------Dr.
50,000
To Bank Account
31st Statement of Profit and Loss-------------------- 2,60,000

March. ------------------Dr.
1,00,000
60,000
Account
1,00,000
Account
To Debenture Interest Account
32. Solution :-

(Rs.)
1st Bank Account--------------------------- 10,80,000

April Dr.(10,00,000 + 80,000)
10,80,000
1st Deb. App. & All. Account ----------------------- 10,80,000

April -----Dr.
1,00,000
Loss on issue of deb. Account--------------Dr.
10,00,000
(10,00,000*10%)
To 10% Debentures 80,000
Account(10,000*100)
1,00,000
To Securities Premium Account
Account(10% of 10lakh)
31st Debentures Interest Account ------------------ 30,000

March -------------------Dr.
30,000
To Debenture holder
(10,00,000*6%*6/12)
31st Debenture holder --------------------------------- 30,000

March -------------------Dr.
30,000
To Bank Account
31st Securities Premium Account------------------- 80,000

March. -------------------Dr.
20,000
Statement of Profit and Loss-------------------
1,00,000
-------------------Dr.

Account
31st Statement of Profit and Loss------------------- 60,000

March -------------------Dr.
60,000
To Debentures Interest Account
33. Solution :-
a)

(Rs.)
1. Bank Account---------------------------Dr. 5,00,000
To Bank Loan Account 5,00,000
2. Deb. Suspense Account ---------------------------- 6,00,000

Dr.
6,00,000
To 10% Debentures Account
An Extract of Balance Sheet

Particulars Note Amount (Rs.)
No.
Non-Current Liabilities
Long Term Borrowings 1 5,00,000
Notes to Accounts:-
Particulars Amount (Rs.)
Long Term Borrowings
Bank Loan 5,00,000
6,000, 10% debentures of Rs.100 each as collateral security

6,00,000
Less : Debenture Suspense

(6,00,000)
b) An Extract of Balance Sheet

No.
Non-Current Liabilities
Long Term Borrowings 1 5,00,000
Notes to Accounts:-
Long Term Borrowings
Bank Loan 5,00,000
( Secured by issue of 6,000, 10% debentures of Rs.100 each

as a collateral security)
34. Solution :-

(Rs.)
1st Bank Account--------------------------- 9,50,000

April Dr.(10,00,000 – 50,000)
9,50,000
1st Deb. App. & All. Account ------------------------- 9,50,000

April ---Dr.
50,000
Discount on issue of debentures Account-
60,000
Dr.(10,00,000*5%)
10,00,000
Loss on issue of deb. Account-----------------
Dr. 60,000
To 10% Debentures
Account(10,000*100)
31st Statement of Profit and Loss-------------------- 1,10,000

March ------------------Dr.
60,000
50,000
Account

Account
35. Solution :
An Extract of Balance Sheet
No.
Shareholder’s Fund
Share Capital 1 1,97,00,000
Notes to Accounts:-
Authorised Capital (5,00,000 Equity shares of Rs.100 each) 5,00,00,000
Issued Capital (2,00,000 equity shares of Rs.100 each) 2,00,00,000
Subscribed and fully paid Capital
(2,00,000-10,000) of Rs.100 each 1,90,00,000
Subscribed but not fully paid Capital
10,000 shares of Rs.100 each :-

10,00,000
7,00,000
Less : Calls in arrears (10,000*30) :-
(3,00,000)
1,97,00,000
36. Solution :-
37. An Extract of Balance Sheet
No.
Shareholder’s Fund
Share Capital 1 2,86,25,000
Notes to Accounts:-
Authorised Capital (5,00,000 Equity shares of Rs.100 each) 5,00,00,000
Issued Capital (3,00,000 equity shares of Rs.100 each) 3,00,00,000
Subscribed and fully paid Capital
(2,90,000-15,000) of Rs.100 each 2,75,00,000
Add:- Share Forfeited (15,000*75) 11,25,000
2,86,25,000
38. Solution :-
Current Ratio :- Current Assets / Current Liabilities
Quick Ratio :-Quick Assets / Current Liabilities
Let Current Liabilities :- x
Current Ratio :- 3:1 Quick Ratio :- 1:1
Current Assets / x :- 3/1 Quick Assets / x

:- 1/1
Current Assets :- 3x Quick Assets :- 1x
Inventory :- Current Assets – Quick Assets

40,000 :- 3x – 1x
2x :- 40,000
X:- 40,000 / 2 :- 20,000
Current Assets :- 3*20,000 :- Rs.60,000
Quick assets :-1*20,000 :- Rs.20,000.
39. Solution :-
Current Ratio :- Current Assets / Current Liabilities
Let Current Liabilities :- x
Current Ratio :- 3:1
Current Assets / x :- 3/1
Current Assets :- 3x
Working Capital :- Current Assets – Current Liabilities
4,00,000 :- 3x -1x
X :- 4,00,000/2 :- 2,00,000
Current Assets :- 3*2,00,000 :- Rs.6,00,000
40. Solution :-
Items Major Head Sub Head
Loose Tools Current Assets Inventory
Securities Premium Share Holder’s Fund Reserve and Surplus
Bank Loan ( 5 month Current Liabilities Short Term Borrowings

maturity) Creditors Current Liabilities Trade Payable
10% Debentures Non-Current Liabilities Long Term Borrowings
10% Preference Share Share Holder’s Fund Share Capital

Capital
Plant, Property and Fixed Assets (Tangible
Machinery Equipment and Intangible Assets)
Assets
Short Term Borrowings
Current Liabilities
Fixed Assets (Intangible
Bank Overdraft
Plant, Property and Assets)
Goodwill Equipment and Intangible
Reserve and Surplus
Assets
Share Holder’s Fund

Inventory
Statement of Profit and
Loss Cash and Cash
Current Assets
Equivalents
Current Assets
Stores and Spares
Cash in Hand
41. Solution:-
Revaluation Account
Particulars Rs. Particulars Rs.
To Machinery 15,000 By Land 60,000
To Furniture 15,000 By Provision for doubtful 1,800
debts
By Stock 5,000
To profit tfd. to 36,800
A’s Capital 22,080
B’s Capital 14,720
66,800 66,800
Partner’s Capital Account
Particulars A(Rs.) B(Rs.) C(Rs.) Particulars A(Rs.) B(Rs.) C(Rs.)
To Cash 30,000 --- --- By bal. b/d 4,00,000 6,00,000 ---
To Goodwill 30,000 20,000 --- By Cash --- --- 2,85,450
To Stock 37,500 37,500 --- By Premium 60,000 --- ---
By 22,080 14,720 ---
Revaluation
By Gen. Res. 48,000 32,000 ---
To bal. c/d 5,04,580 6,37,220 2,85,450 By P & L 72,000 48,000 ---
6,02,080 6,94,720 2,85,450 6,02,080 6,94,720 2,85,450
Capital of C :- (5,04,580+6,37,220) * 1/5 * 5/4 (reverse of 1-1/4 ) :- Rs.2,85,450
42. Solution:-
Revaluation Account
To Plant and Machinery 40,000 By Building 1,20,000
To Furniture 20,000 By Provision for 10,000
doubtful debts
By Stock 10,000
To profit tfd. to 80,000
X’s Capital 32,000
Y’s Capital 24,000
Z’s Capital 24,000
1,40,000 1,40,000
Particulars X(Rs.) Y(Rs.) Z(Rs.) W(Rs.) Particulars X(Rs.) Y(Rs.) Z(Rs.)
To Goodwill 40,000 30,000 30,000 --- By bal. b/d 4,00,000 3,00,000 2,00,000
By Cash -------- --- ---
--- By W’s Current --- --- 30,000
By Revaluation 32,000 24,000 24,000
To Cash --- --- 14,000 By P & L 1,20,000 90,000 90,000
To bal. c/d 6,00,000 4,50,000 3,00,000 1,50,000 By Cash 88,000 66,000 ---
6,40,000 4,80,000 3.44,000 1,50,000 6,40,000 4,80,000 3,44,000
a) Capital of new firm :- 1,50,000 * 10/1 :- Rs.15,00,000 @ 4:3:2:1 ( To balance

c/d)
b) X’s Sacrifice :- 4/10 -4/10:- nil
Y’s Sacrifice :-3/10 – 3/10 :- nil
Z’s Sacrifice :- 3/10 -2/10 :- 1/10
43. Solution:-
Realisation Account
To Plant and Machinery 1,50,000 By Creditors 40,000
To Land 1,00,000 By Mrs. Arun’s Loan 10,000
To Stock 50,000 By Provision 1,000
To Debtors 50,000 By Inv. F.F. 10,000
To Furniture 30,000 By Bank Loan 40,000
To Investments 40,000 By Arun’s Capital(Stock) 45,000
To Arun’s Capital (Loan) 10,000 By Bank :- 4,00,750
To Arun’s Capital(Exp.) 2,000 Furniture 28,000
To Bank :- 27,000 Debtors 23,750
Creditors (40,000-10,000- Investments 39,000
10% of 30,000) 27,000 Plant 1,65,000
To Profit tfd. to 87,750 Land 1,20,000
Arun’s Capital 52,650 Debtors 25,000
Varun’s Capital 35,100
5,46,750 5,46,750
44. Solution:-
Realisation Account
To Plant 65,000 By Creditors 40,000
To Motor Van 28,000 By Mrs. A’s Loan 50,000
To Debtors 41,000 By E.P.F. 18,000
To Investments 34,000 By Bank Overdraft 10,000
To Stock 24,000 By Depreciation Reserve 5,000
To Building 1,02,000 By Bills Payable 32,000
To A’s Capital (Comm.) 5,000 By A’s Capital(Inv.) 18,700
To A’s Capital (loan) 50,000 By Bank :- 2,36,250
To Bank :- 81,200 Investment 16,150
Creditors 36,000 Building 1,10,000
Bills Payable 27,200 Debtors 45,100
E.P.F. 18,000 Plant 65,000
To Profit tfd. to 4,950 By C’s Capital (M.V.) 25,200
A’s Capital 1,980
B’s Capital 1,485
C’s Capital 1,485
4.35.150 4.35.150
45. Solution :-
Revaluation Account
To Stock 4,000 By Creditors 2,500
To Furniture 14,500 By Loss tfd. to 42,000
To Provision for d.d. 6,000 A’s Capital 21,000
To Land 15,000 B’s Capital 12,600
To W.C.F. 5,000 C’s Capital 8,400
44,500 44.500
To Revaluation 21,000 12,600 8,400 By bal. b/d 1,00,000 80,000 60,000
To Goodwill 20,000 12,000 8,000 By G.R. 22,500 13,500 9,000
To Adv. Sus. 5,000 3,000 2,000 By P/L. 20,000 12,000 8,000
To C’s Capital 30,000 18,000 --- By A’s Capital --- --- 30,000
To Cash --- --- 30,000 By B’s Capital --- 18,000
To C’s Loan --- --- 76,600
To Current Ac --- 12,500
To Bal. c/d 79,000 47,400 By Current Ac 12,500 ---
1,55,000 1,05,500 1,25,000 1,55,000 1,05,500 1,25,000
a) Adjusted Capital of A :- 66,500

Adjusted Capital of B :- 59,900
Total Capital :- 1,26,400 @ 5:3
b) Share of goodwill of C :- 2,40,000*2/10 :- Rs.48,000 @5:3
46. Solution :-
Bharti’s Capital Account
By balance c/d 12,000
By G.R. 4,000
By P/l 3,333
Suspense(100000*10%*1/3)
By 240
I.O.C.(12,000*10%*73/365
By Arti’s Capital 1,00,000
To Bharti’s Executor 1,52,906 By Seema’s Capital 33,333
1,52,906 1,52,906
47. Solution:-
Profit and Loss Appropriation Account

To Interest on Capital 1,20,000 By net profit 10,00,000 9.92,800
X’s Capital 50,000 Less : int. on loan 7,200
Y’s Capital 30,000 (120000*12%*6/12)
Z’s Capital 40,000 By Interest on drawings 11,700
To X’s Salary 1,20,000 X’s Capital 3,600
To Y’s Bonus 60,000 Y’s Capital 3,900
To Z’s Commission 87,280 Z’s Capital 42,00
( 992800-120000)*10%
To Profit tfd. to 6,17,220
X’s Capital 3,08,610
Y’s Capital 2,05,740
Z’s Capital 1,02,780
10,04,500 10,04,500

Particulars X(Rs.) Y(Rs.) Z(Rs.) Particulars X(Rs.) Y(Rs.) Z(Rs.)
To drawings 1,20,000 1,30,000 1,40,000 By bal. b/d 5,00,000 3,00,000 4,00,000
To int. on dgs. 3,600 3,900 4,200 By int. on cap. 50,000 30,000 40,000
By Salary 1,20,000 --- ---
By Bonus --- 60,000 ---
By Comm. --- --- 87,280
To bal.c/d 8,55,010 4,61,840 4,85,860 By P/L app. 3,08,610 2,05,740 1,02,780
9,78,610 5,95,740 6,30,060 9,78,610 5,95,740 6,30,060
48. Solution:-

To Interest on Capital 64,000 By net profit 8,00,000 6,66,667
A’s Current 24,000 Less : Mgr. comm. 1,33,333
B’s Current 16,000 (8,00,000*20/120
Cs Current 24,000 By Interest on drawings 18,000
To B’s Salary 48,000 A’s Current 6,000
To Profit tfd. to 5,72,667 B’s Current 6,000
A’s Current 2,29,067 Cs Current 6,000
B’s Current 2,29,067
Cs Current 1,14,533
6,84,667 6,84,667

By bal. b/d 3,00,000 2,00,000 3,00,000
To bal. c/d 3,00,000 2,00,000 3,00,000
3,00,000 2,00,000 3,00,000 3,00,000 2,00,000 3,00,000
Partner’s Current Account
To bal. b/d --- --- 10,000 By bal. b/d 12,000 15,000 ---
To drawings 1,20,000 1,20,000 1,20,000 By int. on cap. 24,000 6,000 24,000
To int. on dgs. 6000 6,000 6,000 By Salary --- 48,000 ---
To bal.c/d 1,39,067 1,72,067 2,533 By P/L app. 2,29,067 2,29,067 1,14,533
2,65,067 2,98,067 1,38,533 2,65,067 2,98,067 1,38,533
49. Solution :-

To Interest on Capital 80,000 By net profit 6,00,000
A’s Capital 30,000
Cs Capital 30,000
To A’s Salary 1,20,000
To B’s Salary 60,000
To C’s Bonus 50,000
To Profit tfd. to
A’s Capital 1,28,889
Gain from B 8,444
Gain from C 12,667 1,50,000

Sac. to A (8,444) 56,000
Cs Capital 96,667
Sac. to A (12,667) 84,000
6,00,000 6,00,000
Deficiency of Rs.21,111(1,50,000-128,889) is to be borne by B and C in 2:3.

50. Solution :-
a) Interest on Capital of X – Rs.40,000
Interest on Capital of Y:- Rs.50,000
Profit for the year :- Rs.72,000
Total interest on capital is Rs.90,000
So, in this case, profit is insufficient allow interest on capital. Profit will be
distributed in their interest on capital ratio i.e. 4:5 ( or Capital Ratio)
Interest on Capital of X :- 72,000 * 4/9:- Rs.32,000
Interest on Capital of Y :- 72,000 * 5/9:- Rs.40,000

To interest on capital 72,000 By net profit 72,000
72,000 72,000
b)
Profit and Loss Account

X’s Capital 40,000 By loss tfd.to 18,000
Y’s Capital 50,000 X’s Capital 10,800
Y’s Capital 7,200
90,000 90,000
X and Y are partners sharing profits and losses in the ratio of 3 : 2. Their capital
accounts showed balances of Rs.1,50,000 and Rs.2,00,000 respectively on Jan 01,
2023.
51. Solution :
a)

To profit tfd.to 50,000 By net profit 50,000
50,000 50,000
b) No interest on capital will be allowed, a firm is alsready incurring loss of
Rs.10,000
c)

To profit tfd.to 22,000
Y’s Capital 8,800
50,000 50,000
d) Interest on Capital of A – Rs.12,000

Interest on Capital of B:- Rs16,000
Profit for the year :- Rs.14,000
Total interest on capital is Rs.28,000
So, in this case, profit is insufficient allow interest on capital. Profit will be
distributed in their interest on capital ratio i.e. 3:4 ( or Capital Ratio)
Interest on Capital of A :- 14,000 * 3/7:- Rs.6,000
Interest on Capital of Y :- 14,000 * 4/7:- Rs.8,000

X’s Capital 6,000
Y’s Capital 8,000
14,000 14,000
52. Solution :-
Interest on drawings :- (6,000*7) * 6/100 * 4/12 :- Rs.840
53. Solution :-
Interest on drawings :- (7,500*9) * 10/100 * 7/12 :- Rs.3,937.50
54. Solution :-
Interest on drawings :- ( 7,000*6) * 10/100 :- Rs.4,200
55. Solution :-
Interest on drawings :- (8,000*2) * 6/100 * 4.5/12:-Rs.360
56. Solution :-
Interest on drawings :- (7,800*4) * 12/100 * 4.5/12 :- Rs.1,40,4
57. Solution :-
Interest on drawings :- 900 :- X * 6/100 * 4.5/12
Amunt of annual drawings :- Rs.40,000
Monthly Draings :- Rs. 3,333
58. Solution :-
Product Method
Date of drawings Amount of drawings No. of months Product(Rs.)
(Rs.)
31st Aug. 7,000 7 49,000
1st Oct. 12,000 6 72,000
1st Dec. 15,000 4 60,000
28th Feb. 25,000 1 25,000
Total 2,06,000
Interest on drawings :- 2,06,000 * 12/100 * 1/12 :- Rs.2,060
59. Solution :-
Interest on Capital of X :- (4,00,000*10%*6/12) + (4,50,000*10%*6/12) :-
Rs.42,500
Interest on Capital of Y :- (5,00,000*10%*6/12) + (4,50,000*10%*6/12) :-
Rs.47,500
60. Solution:-
Analytical Table
Particulars X(Rs.) Y(Rs.) Z(Rs.) Total(Rs.)
Interest on capital (Cr.) 60,000 50,000 40,000 1,50,000

Loss Rs.1,50,000 @ 5:3:2 (Dr.) 75,000 45,000 30,000 1,50,000
Net Effect 15,000(Dr.) 5,000(Cr.) 10,000(Cr.) Nil
X’s Capital Account------------------------------Dr. 15,000

To Y’s Capital 5,000
To Z’s Capital 10,000
61. Solution:-
62. Analytical Table
Particulars Anil(Rs.) Sunil(Rs.) Total(Rs.)
Interest on drawings (Dr.) 4,000 5,000 9,000

Profit Rs.9,000 @ 3:1 (Cr.) 6,750 2,250 9,000
Net Effect 2,750(Cr.) 2,750(Dr.) Nil
Sunil’s Capital Account------------------------------Dr. 2,750

To Anil’s Capital 2,750
___________________________________

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Questions for the weak students

Particulars 2021-22(Rs.) %age 2022-23(Rs.) %age

Revenue from Operations 4,00,000 100 6,00,000 100

Other Income 1,00,000 25 1,50,000 25

Total Revenue 5,00,000 125 7,50,000 125

Employees Benefit Expenses 80,000 20 1,80,000 30

Finance Cost 50,000 12.5 60,000 10

Total Expense 1,30,000 32.5 2,40,000 40

Profit before tax (T.R. – T.E.) 3,70,000 92.5 5,10,000 85

Tax 1,85,000 46.25 2,55,000 42.5

Profit after tax 1,85,000 46.25 2,55,000 42.5

Particulars 2021-22(Rs.) 2022-23(Rs.) Absolute % age

Revenue from Operations 24,00,000 25,00,000 1,00,000 4.17

Total Revenue 24,00,000 25,00,000 1,00,000 4.17

Cost of revenue from 8,00,000 10,00,000 2,00,000 25

Profit after tax

2. Premium for Goodwill Account--- 1,00,000

3. X’s Capital Account------------------ 36,000

1. Cash Account-------------------------- 2,60,000

2. Premium for Goodwill Account--- 60,000

3. A’s Capital Account------------------ 30,000

A’s Sacrifice :- 3/5 – 2/5 :- 1/5

To Z’s Capital Account

2. X’s Capital Account------------------- 40,000

Share of goodwill of Z:- 3,60,000*2/9 :- 80,000

1. P’s Capital Account------------------- 80,000

2. P’s Capital Account------------------- 50,000

Share of goodwill of R :- 4,00,000*2/10 :- 80,000

Date Particulars l/f Debit (Rs.) Credit(Rs.)

1. Profit & Loss Suspense Account - 78,125

1. Profit & Loss Suspense Account - 40,000

Date Particulars l/f Debit (Rs.) Credit(Rs.)

1. Profit & Loss Suspense Account 29,167

2. Shyam’s Capital Account----------- 65,250

To Ram’s Capital Account

1. X’s Capital Account------------------ 38,000

2. Realisation Account------------------ 1,00,000

3. Realisation Account------------------ 80,000

5. Bank Account-------------------------- 12,000

6. Realisation Account------------------ 9,000

7. Bank Account-------------------------- 2,00,000

8. Profit & Loss Account--------------- 40,000

9. X’s Capital Account------------------ 4,000

10. Bank Account-------------------------- 13,000

Goodwill :- (1,00,000-10,000) * 3 :-Rs.2,70,000

1. Y’s Capital Account------------------- 65,000

Date Particulars l/f Debit (Rs.) Credit(Rs.)

1. A’s Capital Account------------------- 8,000

To C’s Capital Account

1. Y’s Capital Account------------------- 10,000

2. Bank Account---------------------- 1,02,000

3. Share Forfeited Account------------- 6,000

1. Share Capital Account---------------- 3,20,000

2. Bank Account---------------------- 1,96,000

3. Share Forfeited Account------------- 14,000

1. Share Capital Account---------------- 42,000

2. Bank Account---------------------- 33,600

3. Share Forfeited Account------------- 12,600