Scribd
Upload
85 views3 pages

Retirement of Partner III

The document outlines the retirement processes for several partners in different firms, detailing the calculations required for capital accounts, goodwill, and loan accounts upon retirement. It includes specific financial data and terms for each case, such as profit sharing ratios, valuations of goodwill, and provisions for debts. The document requires the preparation of various accounts including revaluation accounts and loan accounts for the retiring partners.

Uploaded by

tanishbru11
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
85 views3 pages

Retirement of Partner III

The document outlines the retirement processes for several partners in different firms, detailing the calculations required for capital accounts, goodwill, and loan accounts upon retirement. It includes specific financial data and terms for each case, such as profit sharing ratios, valuations of goodwill, and provisions for debts. The document requires the preparation of various accounts including revaluation accounts and loan accounts for the retiring partners.

Uploaded by

tanishbru11
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 3

RETIRING PARTNERS CAPITAL & LOAN A/C

1. Meera, Sarthak and Rohit were partners sharing profits in the ratio of 2 : 2 : 1. On 31
March 2018, their Balance Sheet was as follows :

Sarthak retired on 15th June, 2018. The firm’s profits for the last four years were : 2014 -
15 Rs.1,20,000, 2015 - 16 Rs.2,00,000, 2016 - 17 Rs.2,60,000 and 2017 - 18
Rs.2,20,000.
According to the partnership deed, on retirement he was entitled to :
1. Balance in his Capital Account.
2. His share of goodwill will be calculated on the basis of thrice the average of the past 4
years’ profits.
3. His share in profits up to the date of death on the basis of average profits of the last two
years. The time period for which he survived in the year of death will be calculated in
months.
4. Interest on capital @ 12% p.a. up to the date of his retirement
Prepare Sarthak’s Capital a/c

2. Lalit, Madhur and Neena were partners sharing profits as 50%, 30% and 20% respectively.
On 31st March, 2013 their balance sheet was as follows
On this date, Madhur retired and Lalit and Neena agreed to continue on the following
terms
1.The goodwill of the firm was valued at Rs 51,000.
2. There was a claim for workmen’s compensation to the extent of Rs 6,000
3. Investments were brought down to Rs 15,000.
4. Provision for bad debts was reduced by Rs 1,000.
5. Madhur was paid Rs 10,300 in cash and the balance was transferred to his loan
account payable in two equal installments together with interest @ 12% per annum
Prepare revaluation account, Retiring partners’ capital account & his loan a/c till the
loan is finally paid off

3. Khushboo, Leela and Meena were partners in a firm sharing profits in the ratio of 5:3:2.
Their Balance Sheet on March 31, 2015 was as follows:

On April 1,2015 Leela retired on the following terms:

i. Building was to be depreciated by Rs.10,000.

ii. A Provision of 5% was to be made on Debtors for doubtful debts.

iii. Salary outstanding was Rs.4,800.

iv. Goodwill of the firm was valued at Rs.1,40,000.

v. Leela was to be paid Rs.20,800 through cheque and the balance was to be paid in
two equal quarterly installments (starting from June 30, 2015) along with interest @
10% p.a.

Prepare Revaluation Account, Leela's Capital Account and her Loan Account till it is
finally paid.
4. X, Y & Z are partners sharing profits in 3:2:1. The Balance sheet on 31.3.22 was as
follows:

Z retired on 1.4.2022 on following terms:


(a) Goodwill of the firm is valued at ₹30,000.
(b) The loss on revaluation of assets and reassessment of liabilities on amounted to ₹7,200.
(c) Z took over half of investments at ₹6,500 and remaining were shown in the books at its
book value.
(d) Liability of workmen compensation was ₹3,000.
e) The amount due to Z on retirement was transferred to his loan A/c, which was payable in 2
equal annual instalment staring from 1.4.2023 with an interest @10% p.a
Prepare Z’s loan A/c till it is paid off. Show your workings clearly.

You might also like