Dear Teachers,
These slides have been prepared based on the NCERT syllabus to support you in teaching Plus One and Plus Two Accountancy and Computerised Accounting.
Please review and verify the content before using it in your classrooms. If you find any errors or have feedback, please let me know.
Mujeeb Rahiman C
HSST Commerce
GHSS Pattikkad
Malappuram Dt.
✉️ mujeebchemmala@gmail.com
9995983075 �
Chapter - 3
Reconstitution of a Partnership Firm
Retirement / Death of a Partner
Revaluation Account | Capital Account | Balance Sheet
illustration
Adithyan, Nandhu, and Rijin were partners sharing profit and losses in the ratio of 3:2:1. On 1st April 2018 Nandhu retires. On that date their balance sheet was as follows
Liabilities Amount
Creditors 3000
Bills Payable 12000
Expenses outstanding 12000
General Reserve 13500
Capital :
Adithyan 15000
Nandhu 10000
Rijin 5000
70500
Assets Amount
Cash 9000
Debtors 15000
Stock 12000
Premises 20500
Machinery 10000
Furniture 4000
70500
Balance Sheet
The terms were : (1) Goodwill of the firm was valued at Rs. 13000
(2) Expenses outstanding to be brought down to Rs. 3750
(3) Machinery and furniture are to be valued at 10% less than the book value
(4) Premises are to be revalued at Rs.24300
Prepare Revaluation A/c, Partners capital Account and Balance Sheet of the firm after
retirement of Nandhu.
Amount
Particulars
Amount
Particulars
Machinery (10000 x 10%)
1,000
Furniture (4000 x 10%)
400
12,050
12,050
REVALUATION ACCOUNT
Capital Accounts – 3:2:1
Adithyan 5,325
Nandhu 3,550
Rijin 1,775
10,650
Expenses outstanding
(12000 - 3750)
8,250
Premises (24300 - 20500)
3,800
(1) Goodwill of the firm was valued at Rs. 13000
(2) Expenses outstanding to be brought down to Rs. 3750
(3) Machinery and furniture are to be valued at 10% less than the book value
(4) Premises are to be revalued at Rs.24300
Rijin
Particulars
Balance b/d
2,250
CAPITAL ACCOUNTS
Nandhu
10,000
Adithyan
15,000
Date
01/04/18
Rijin
Particulars
Nandhu
Adithyan
Date
General Reserve
3:2:1
4,500
6,750
Revaluation A/c
3,550
5,325
9,025
22,383
27,075
9,025
Balance c/d
7,942
22,383
27,075
23,825
1,083
3,250
01/04/18
Nandhu’s Cap. A/c
5,000
1,775
Calculation of Nandhu’s Share of goodwill :-
Old Ratio = 3:2:1
Goodwill of the firm = 13,000
Nandu’s share of goodwill = 13,000 x 2/6 = 4,333
Gaining Ratio = 3:1
Journal entry for G/W:
Adityan‘s capital A/C Dr. 3250 (4333 x 3/4)
Rijin’s Capital A/C Dr. 1083 (4333 x 1/4)
To Nandhu’s capital 4333
Adithyan’s Cap. A/c
3,250
Rijin’s Cap. A/c
1,083
Nandhu’s Loan A/c
22,383
01/04/18
Amount
Liabilities
Amount
Assets
Creditors
3,000
Bills Payable
12,000
72,900
72,900
Balance Sheet
Capital Accounts –
Adithyan 23,825
Rijin 7,942
31,767
Cash
9,000
Debtors
15,000
(1) Goodwill of the firm was valued at Rs. 13000
(2) Expenses outstanding to be brought down to Rs. 3750
(3) Machinery and furniture are to be valued at 10% less than the book value
(4) Premises are to be revalued at Rs.24300
Stock
12,000
Premises
24,300
Machinery (10000 - 1000)
9,000
Furniture (4000 - 400)
3,600
Expenses outstanding
3,750
Nandhu’s Loan A/c
22,383
Mujeeb Rahiman C
HSST Commerce
GHSS Pattikkad
Malappuram Dt.
Revaluation Account | Capital Account | Balance Sheet
Amount
Particulars
Amount
Particulars
Machinery (10000 x 10%)
1,000
Furniture (4000 x 10%)
400
12,050
12,050
REVALUATION ACCOUNT
Capital Accounts – 3:2:1
Adithyan 5,325
Nandhu 3,550
Rijin 1,775
10,650
Expenses outstanding
(12000 - 3750)
8,250
Premises (24300 - 20500)
3,800
Revaluation Account | Capital Account | Balance Sheet
Rijin
Particulars
Balance b/d
2,250
CAPITAL ACCOUNTS
Nandhu
10,000
Adithyan
15,000
Date
01/04/18
Rijin
Particulars
Nandhu
Adithyan
Date
General Reserve
3:2:1
4,500
6,750
Revaluation A/c
3,550
5,325
9,025
22,383
27,075
9,025
Balance c/d
7,942
22,383
27,075
23,825
1,083
3,250
01/04/18
Nandhu’s Cap. A/c
5,000
1,775
Adithyan’s Cap. A/c
3,250
Rijin’s Cap. A/c
1,083
Nandhu’s Loan A/c
22,383
01/04/18
Revaluation Account | Capital Account | Balance Sheet
Amount
Liabilities
Amount
Assets
Creditors
3,000
Bills Payable
12,000
72,900
72,900
Balance Sheet
Capital Accounts –
Adithyan 23,825
Rijin 7,942
31,767
Cash
9,000
Debtors
15,000
Stock
12,000
Premises
24,300
Machinery (10000 - 1000)
9,000
Furniture (4000 - 400)
3,600
Expenses outstanding
3,750
Nandhu’s Loan A/c
22,383