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Problem:50 (UQS) (A) Journal Entries Date Accounts Title & Explanation Ref Debit Credit

This document contains journal entries for a partnership firm admitting a new partner. It records the assets and goodwill brought in by the new partner, revaluation of assets, transfer of revaluation profit and reserve to old partners' capital accounts. It also contains the partners' capital accounts and a balance sheet prepared after admission of the new partner.

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Yasir Arafat
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12 views5 pages

Problem:50 (UQS) (A) Journal Entries Date Accounts Title & Explanation Ref Debit Credit

This document contains journal entries for a partnership firm admitting a new partner. It records the assets and goodwill brought in by the new partner, revaluation of assets, transfer of revaluation profit and reserve to old partners' capital accounts. It also contains the partners' capital accounts and a balance sheet prepared after admission of the new partner.

Uploaded by

Yasir Arafat
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
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Problem:50(UQS)

(a) Journal Entries

Date Accounts Title & Explanation Ref Debit Credit


2012 Furniture 7,800
Jan-01 Inventory 13,800
C’s Capital 21,600
(To record assets brought in by C as
capital)

Goodwill (18,000-12,000) 6,000


1 2,000
A’s Capital [6,000 × (1+2)]
2 4,000
B’s Capital [6,000 × (1+2)]
(To record Goodwill transferred to old
Partners Capital in their old ratio 1:2)

Building (30,000-14,400) 15,600


Furniture (18,000-13,200) 4,800
Revaluation 20,400
(To record increase on plant & machinery)

Revaluation 20,400
1 6,800
A’s Capital [20, 400 × (1+2)]
2 13,600
B’s Capital [20, 400 × (1+2)]
(To record profit on revaluation
transferred to the old Partners Capital in
their old ratio 1:2)

Reserve 9,000
1 3,000
A’s Capital [9, 000 × (1+2)]
2 6,000
B’s Capital [9, 000 × ]
(1+2)
(To record reserve transfer to old Partners
Capital in their old ratio 1:2)

1 16,600
A’s Capital [52, 200 × ]
(1+2)
2 35,600
B’s Capital [52, 200 × (1+2)
] 52,200
Cash
(To record cash withdrawn to old Partners
Capital in their old ratio 1:2)

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Revaluation

Dr. Cr.

Account Titles Amount Account Titles Amount


Profit on Revaluation Transferred to: Building 15,600
1 6,800 Furniture 4,800
Capital-A [20, 400 × (1+2)]
2
Capital-B [20, 0400 × (1+2)] 13,600

20,400 20,400

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(b) Partners’ Capital Account

Dr. Cr.

Account Titles A B C Account Titles A B C


Tk Tk Tk Tk Tk Tk
Balance b/d 26,400 33,600
Reserve 3,000 6,000
Cash (withdrawn) 16,600 35,600 Goodwill 2,000 4,000
Sundry Assets 21,600
Balance c/d 21,600 21,600 21,600 Revaluation (Profit) 6,800 13,600

38,200 57,200 21,600 38,200 57,200 21,600

Cash

Dr Cr

Accounts Title Amount Accounts Title Amount


Balance b/d 30,000
Balance c/d 55,200 Capital-A 16,600
Capital-B 35,600

55,200 55,200

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A,B & C

(c) Balance Sheet

Assets Amount Liabilities & Owners Amount


Equity
Current Assets Current Liabilities
Accounts Receivable 13,200 Accounts Payable 6,000
Inventory (25,200+13,800) 39,000 Bank Overdraft 55,200

Fixed Assets Owner’s Equity


Buildings 30,000 Capital-A 21,600
Furniture (18,000+7,800) 25,800 Capital-B 21,600
Goodwill 18,000 Capital-C 21,600
64,800

1,26,000 1,26,000

Workings
𝟏rd
C brings (7,800+13,800) = Tk. 21,600 as capital for share
𝟑

The new ratios of all partners are equal. So,the new ratio is 1:1:1
𝟑
Total Capital = 𝟐𝟏, 𝟔𝟎𝟎 × = 𝟔𝟒, 𝟖𝟎𝟎
𝟏
𝟏
A’s adjusted Capital = 𝟔𝟒, 𝟖𝟎𝟎 × = 𝟐𝟏, 𝟔𝟎𝟎
𝟑
𝟏
B’s adjusted Capital = 𝟔𝟒, 𝟖𝟎𝟎 × = 𝟐𝟏, 𝟔𝟎𝟎
𝟑

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