JAYPEE PUBLIC SCHOOL, NOIDA

SUMMER HOILDAYS HOMEWORK

CLASS XII : ASSISGMENT

CHAP 1-4

ASSIGNMENT QUESTIONS (TO BE DONE IN SEPARATE NOTEBOOK)

CHAPTER 1 : PARTNERSHIP FUNDANMENTALS

1.Dev withdrew ₹ 10,000 on 15th day of every month. Interest on drawings was to be charged @ 12% per
annum. Calculate interest on Dev’s drawings.

2.Amit, a partner in a partnership firm withdrew ₹ 7,000 in the beginning of each quarter. For how many
months would interest on drawings be charged?

3.Amit and Bhola are partners in a firm. They share profits in the ratio of 3:2. As per their partnership
agreement, interest on drawings is to be charged @ 10% p.a. Their drawings during 2013 were ₹ 24,000 and
₹ 16,000, respectively. Calculate interest on drawings based on the assumption that the amounts were
withdrawn evenly, throughout the year.

4.A, B and C were partners in a firm sharing profits in the ratio of 3 : 2 : 1. B was guaranteed a profit of X
2,00,000. During the year the firm earned a profit of ₹ 84,000. Calculate the net amount of Profit/Loss
transferred to the capital accounts of A and C.

5. Maanika, Bhavi and Komal are partners sharing profits in the ratio of 6:4:1. Komal is guaranteed a
minimum profit of ₹ 2,00,000. The firm incurred a loss of ₹22,00,000 for the year ended 31st March,
2018. Pass necessary journal entry regarding deficiency borne by Maanika and Bhavi.

6.A, B and C were partner in a firm. On 1st April, 2018, their capitals stood at ₹ 4,00,000, ₹ 3,00,000 and
₹2,00,000 respectively. As per the provisions of the partnership deed.
i)A was entitled to a salary of ₹ 5,000 per month.
ii)Partner were entitled to interest on capital @ 10% p.a.
The net profit for the year ended 31st March 2019, ₹ 3,00,000 was divided among the partners without
providing for the above items. Showing your working clearly, pass an adjustment entry to rectify the
above error.
7.Krishna, Sandeep and Karim are partners sharing profits in the ratio of 3 : 2 : 1. Their fixed capitals
are: Krishan ₹ 1,20,000, Sandeep ₹ 90,000 and Karim ₹ 60,000. For the year 2013-14, interest was
credited to them @ 6% p.a. instead of 5% p.a. Record adjustment entry.

8.Anubha and Kajal are partners of a firm sharing profits and losses in the ratio of 2 : 1. Their capital were ₹
90,000 and ₹ 60,000. The divisible profit during the year were ₹ 45,000. According to partnership deed,
both partners are allowed salary @ ₹ 700 per month to Anubha and ₹ 500 per month to Kajal. Interest
allowed on capital @ 5% p.a. The drawings at the end of the period were ₹ 8,500 for Anubha and ₹ 6,500
for Kajal. Interest is to be charged @ 5% p.a. on drawings. Prepare partners capital accounts, assuming that
their capital accounts are fluctuating.

9.Abhay, Siddharth and Kusum are partners in a firm, sharing profits in the ratio of 5 : 3 : 2. Kusum is
guaranteed a minimum amount of₹ 10,000 as per share in the profits. Any deficiency arising on that
account shall be met by Siddharth. Profits for the years ending March 31, 2013 and 2014 are ₹ 40,000 and
60,000 respectively. Prepare Profit and Loss Appropriation Account.

10.Taruna, Karan and Joy were partners sharing profits in the ratio of 5:3:2. The partnership deed provides
the following:
I. Salary of ₹3,000 per quarter to Taruna and Karan.
II. Karan’s was guaranteed a profit of ₹76,000 p.a.
III. Joy was entitled to a commission of ₹ 20,000.
The profit for the year ended was ₹4,00,000 which was distributed among the partners in the ratio of 3:3:2
without taking into consideration the provision of partnership deed. Pass necessary rectifying entry. Show
you working clearly.

CHAPTER 2 : VALUATION OF GOODWILL

1.A business has earned average profits of Rs. 1,00,000 during the last few years and the normal rate of
return in similar business is 10%. Find out the value of goodwill by
(i) Capitalization of super profit method.
(ii) Super profit method, if the goodwill is valued at 3 years’ purchase of super profit. The assets of the
business were Rs. 10,00,000 and its external liabilities Rs. 1,80,000.

2. .A partnership firm earned net profits during the last 3 years as follows:

The capital employed in the firm throughout the above mentioned period has been Rs. 4,00,000. Having
regard to the risk involved, 15% is considered to be a fair return on the capital. The remuneration of all the
partners during this period is estimated to be Rs. 1,00,000 per annum.

Calculate the value of goodwill on the basis of

i)2 years’ purchase of super profits earned on average basis during the above mentioned 3 years and
ii) By capitalization method
3.A business earned average profits of Rs. 1,00,000 during the last few years. The normal rate of return in
similar type of business is 10%. The assets of the business were Rs. 10,00,000 and external liabilities was
Rs. 1,80,000. Calculate the value of goodwill of the firm by super profit method, if the goodwill is valued
at 2.5 years’ purchase of super profits.
4. A business has earned average profit of Rs. 60,000 during the last few years. The assets of the business
are Rs. 5,40,000 and its external liabilities are Rs. 80,000. The normal rate of return is 10%. Calculate the
value of goodwill on the basis of capitalization of super profit
5..The capital of a firm of Arpit and Prajwal is Rs. 10,00,000. The market rate of return is 15% and the
goodwill of the firm has been valued Rs. 1,80,000 at two years purchase of super profits. Find the average
profits of the firm.

CHAPTER 3 : CHANGE IN PROFIT SHARING RATIO

1. Hari, Kunal and Uma are partners in a firm sharing profits and losses in the ratio of 5 : 3 : 2. From
1st April, 2018 they decided to share future profits and losses in the ratio of 2 : 5 : 3. Their Balance
Sheet showed a balance of Rs 75,000 in the Profit and Loss Account and a balance of Rs 15,000 in
Investment Fluctuation Fund. For this purpose, it was agreed that:
(i) Goodwill of the firm was valued at ₹ 3,00,000.
(ii) Investments (having a book value of ₹ 50,000 were valued at ₹ 35,000.
(in) Stock having a book value of ₹ 50,000 be depreciated by 10%. Pass the necessary journal entries
for the above in the books of the firm.
2. Anant, Gulab and Khushbu were partners in a firm sharing profits in the ratio of 5 : 3 : 2. From 1st
April, 2014, they decided to share the profits equally. For this purpose, the goodwill of the firm was
valued at ₹ 2,40,000.Pass necessary journal entry for the treatment of goodwill on change in the profit
sharing ratio of Anant, Gulab and Khushbu.
3. Satish and Taruna were partners in a firm sharing profits and losses in the ratio of 3 : 2. From 1st April,
2018 they decided to share profits equally. On that date, their Balance Sheet showed a credit balance of ₹
35,000 in workmen compensation fund and ₹ 40,000 in general reserve. The goodwill of the firm on that
date was valued at ₹ 50,000. The firm accepted a claim of ₹ 40,000 for workmen compensation.
Pass necessary journal entries for the above transactions on the reconstitution of the firm.

4.Parth, Raman and Zaisha are partners in a firm manufacturing furniture. They have been sharing profits
and losses in the ratio of 5 : 3 : 2. From 1st April, 2017 they decided to share future profits and losses in
the ratio of 2 : 5 : 3. Their Balance Sheet showed a debit balance of ₹ 74,000 in Profit and Loss Account;
balance of ₹ 36,000 in General Reserve and a balance of ₹ 12,000 in Workmen’s Compensation Reserve.
It was agreed that:
(i) The goodwill of the firm be valued at ₹ 76,000.
(ii) The stock (book value of ₹ 40,000) was to be depreciated by 8%.
(iii) Creditors amounting to ₹ 900 were not likely to be claimed.
(iv) Claim on account of Workmen’s Compensation amounted to ₹ 20,000.
 (v) Investments (book value ₹ 38,000) were revalued at
₹40,000
Pass necessary journal entries for the above.

5. A, B, C and D were partners in a firm sharing profits in the ratio of 3 : 2 : 3 : 2. On 1st April, 2016 their
balance sheet was as follows:

From the above date the partners decided to share the future profits in the ratio of 4 : 3 : 2 : 1. For this
purpose the goodwill of the firm was valued at ₹ 2,70,000.
It was also considered that:
(i) Claim against workmen compensation reserve will be estimated at ₹ 30,000 and fixed assets will be
depreciated by ₹25,000.
(ii) The capitals of the partners will be adjusted according to the new profit sharing ratio by opening
current accounts of the partners.
Prepare revaluation account, partners’ capital accounts and the balance sheet of the reconstituted firm.

6. R, S and T were partners in a firm sharing profits in 1 : 2 : 3 ratio. Their balance sheet as at 31st March,
2015 was as follows:

From 1st April, 2015 R, S and T decided to share the future profits equally. For this purpose it was
decided that
(i) Goodwill of the firm be valued at ₹ 1,50,000.
(ii) Land be revalued at ₹ 80,000 and building be depreciated by 6%.
 (iii) Creditors of ₹ 6,000 were not likely to be claimed and hence be written-off.
Prepare revaluation account, partners’ capital accounts and the balance sheet of the reconstituted firm.

7. Ram, Shyam and Mohan sharing profits and losses in the ratio of 4:3:2, decide to share future profits
and losses in the ratio of 2:3:4 with effect from 1st April,2022. An extract of their Balance Sheet as at 31st
March,2022 is

Liabilities Amount Assets Amount

Investment fluctuation 18,000 Investments (at cost) 200000
Reserve

Show the accounting treatment under the following alternative cases

1. When there is no other information
2. When market value of investments is Rs.2,00,000
3. When market value of investments is Rs.1,91,000
4. When market value of investments is Rs,2,18,000
5. When market value of investments is Rs.1,73,000

CHAPTER 4 : ADMISSION OF A PARTNER

1.A and B were partners sharing profits in the ratio of 3:2. A surrenders 1/6 of his share and B
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surrenders 1/4 of his share in favour of C, a new partner. What is the new ratio and the sacrificing
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ratio.
2. X and Y divide profits and losses in the ratio of 3:2. Z is admitted in the firm as a new partner with
1/6 share, which he acquires from X and Y in the ratio of 1:1. Calculate the new profit sharing ratio of all
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partners.
3. X and Y are partners sharing profits in the ratio of 5:4. They admit Z in the firm for 1/3 profit, which
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he takes 2/9 from X and 1/9 from Y and brings Rs. 1500 as premium. Pass the necessary Journal
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entries on Z‘s admission.

4. A and B are partners sharing profits equally. They admit C into partnership, C paying only Rs. 1000 for
premium out of his share of premium of Rs. 1800 for 1/4 share of profit. Goodwill account appears in
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the books at Rs. 6000. All the partners have decided that goodwill should not appear in the new firm’s
books. Pass the necessary journal entries
5. X and Y are in partnership sharing profit and losses in the ratio of 3:2. Their balance sheet as on
31st March,2012 was as under:
Liabilities Rs. Assets Rs.
Creditors 15,000 Cash 5,000
General Reserve
12,000 Debtors 20,000
 Less: provision 800 19,200
Capital Accounts:
60,000 Patents 14,800
X
30,000 Investment 8,000
Y
Fixed assets 72,000
10,000 Goodwill 10,000
Current Accounts:
X 2,000

Y
1,29,000 1,29,000
They admit Z on the following terms:-
a. A provision of 5% is to be created on debtors
b. Accrued income of Rs.1,500 does not appear in the books and Rs.5,000 are outstanding
for salaries.
c. Present market value of investment is Rs.6,000. X takes over the investments at this value.
d. New profit sharing ratio of partners will be 4:3:2 .Z will bring in Rs.20,000 as his capital.
e.. Z is to pay in cash an amount equal to his share in firm’s goodwill valued at twice the average profits
of the last 3 years which were Rs.30,000; Rs.26,000 and Rs.25,000 respectively. Half the amount of
goodwill is withdrawn by old partners.
You are required to pass journal entries, prepare revaluation A/c, capital A/cs, current A/cs and balance
sheet.

6.Dinesh, Yashika and Farhan are partners in a firm, sharing profits and losses in 11:7:2 respectively.
The balance sheet of the firm as on 31st March 2019 was as follows:

Balance Sheet As at 31.3.2019

LIABILITIES AMOUNT(₹) ASSETS AMOUNT(₹)

Sundry Creditors 70000 Factory Building 7,35,000
Public Deposits 1,19,000 Plant and Machinery 1,80,000
Reserve fund 90,000 Furniture 2,60,000
Outstanding Expenses 10,000 Stock 1,45,00
0
Capital Accounts Debtors 1,50,000
Dinesh 5,10000 Less: Provision (30000)
Yashika 3,00000
Farhan 5,00000 13,10,000 1,20,000
Cash at bank 1,59,000
15,99,000 15,99,000
On 1.4.2018, Aditi is admitted as a partner for one-fifth share in the profits with a capital of ₹4,50,000
and necessary amount for his share of goodwill on the following terms:
i. Furniture of ₹2,40,000 were to be taken over Dinesh, Yashika and Farhan equally.
ii.A creditor of ₹7,000 not recorded in books to be taken in to account.
iii. Goodwill of the firm is to be valued at 2.5 year purchase of average of last two years profit of the last
three years were:
2016-17 ₹6,00,000; 2017-18 ₹2,00,000; 2018-19 ₹6,00,000
iv. At time of Aditi’s admission. Yashika also brought in ₹50,000 as fresh capital.
v. Plant and Machinery is re-valued to ₹2,00,000 and expenses outstanding were brought down to
₹9,000.
Prepare Revaluation Account, Partners Capital Account and the balance sheet of the reconstituted firm.

7..C and D are partners in a firm sharing profits in the ratio of 4 : 1. On31.3.2016,
theirBalance Sheet was as follows :

LIABILITIES AMT ASSETS AMT

Creditors 40.000 Cash 24,000
Provision for Doubtful 4,000 Debtors 36,000
debts
Stock 40,000
Outstanding Salary
6,000 Furniture 80,000
General Reserve
10,000 Plant &Machinery 80,000
Capitals
C 1,20,000
D 80,000
2,00,000
2,60,000 2,60,000

On the above date, E was admitted for 1/4th share in the profits on the following terms:
(i) E will bring Rs. 1,00,000 as his capital and Rs. 20,000 for his share of goodwill premium, half of

which will be withdrawn by C and D.

(ii) Debtors Rs. 2,000 will be written off as bad debts and a provision of 4% will be created

on debtors for bad and doubtful debts.

(iii) Stock will be reduced by Rs. 2,000, furniture will be depreciated by Rs. 4,000 and 10%

depreciation will be charged on plant and machinery.

(iv) Investments of Rs. 7,000 not shown in the Balance Sheet will be taken into account.

(v) There was an outstanding repairs bill of Rs. 2,300 which will be recorded in the books.

Pass necessary journal entries for the above transactions in the books of the firm on E’s admission.