Question

On the date of retirement of C, the Balance Sheet of A, B and C shows the following position:

Balance Sheet

(i) Profits shares in the ratio of capitals. 

(ii) Profit and Loss is to be credited to the extent of C, through capital adjustment of partners. 

(iii) Bills receivables are collected through a debt collection agency at Rs.9000/- 

(iv) Depreciate all fixed assets @ 10%. Find the amount due to the retiring partner.

Answer 1

C’s Capital a/c

Revaluation a/c

Note: 

1. Profit and Loss = 24000 

C’s share of profit = 24000 x 3/11 = 6545 

Rs.6545 is to be credited to the capital a/c of ‘C’ through capital adjustment of A and B. 

A’s capital a/c (6545 x 5/8) Dr. 4091 

B’s capital a/c (6545 x 3/8) Dr. 2454 

    To C’s capital a/c 6045