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Dear Teachers,

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These slides have been prepared based on the NCERT syllabus to support you in teaching Plus One and Plus Two Accountancy and Computerised Accounting.

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Please review and verify the content before using it in your classrooms. If you find any errors or have feedback, please let me know.

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Mujeeb Rahiman C

HSST Commerce

GHSS Pattikkad

Malappuram Dt.

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✉️ mujeebchemmala@gmail.com

9995983075 �

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Chapter - 3

Reconstitution of a Partnership Firm

Retirement / Death of a Partner

Adjustment of Partners’ Capitals

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At the time of retirement or death of a partner, the remaining partners may decide to adjust their capital contributions in their profit sharing ratio. In such a situation the excess or deficiency of capital in the individual capital account’s may be worked out. Such excess or shortage shall be adjusted by withdrawal of contribution in cash, as the case may be, for which the following journal entries will be recorded.

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Adjustment of Partners’ Capitals

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(i) For excess capital withdrawn by the partner :

Partners’ Capital A/c Dr.

To Cash / Bank A/c

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(ii) For amount of capital to be brought in by the partner:

Cash / Bank A/c Dr.

To Partners’ Capital A/c

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Mujeeb Rahiman C

HSST Commerce

GHSS Pattikkad

Malappuram Dt.

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Mujeeb Rahiman C

HSST Commerce

GHSS Pattikkad

Malappuram Dt.