Ronnie and Annie entered into a Joint Venture to sell coal, sharing profits and losses in the ratio of 1:1. Annie purchased 100 tonnes of coal @ 5,400 per tonne and paid Rs 30,000 as freight for sending the coal to Ronnie to the sold joint account.
During transit, 10 tonnes of coal was lost due to breaking in bulk (normal loss).
Ronnie received the remaining tonnes of coal and paid Rs 6,000 as landing charges.
He accepted a bill drawn by Annie for Rs 2,00,000.
Ronnie then sold 60% of the coal received by him for Rs 4,21,200. His selling expenses amounted to Rs 12,000.
The remaining stock, valued at original cost plus proportionate direct expenses, was shared equally by both the co-ventures.
They settled their accounts by means of a bank draft.
(i) Total sales were Rs 1,80,000 of which 50% were sold on credit and the remaining 50% were sold for cash.
(ii) Expenses amounted to Rs 1,500 towards go down rent and advertisements.
(iii) Bad debts were Rs 1,500.
You are required to :
(i) Memorandum Joint Venture Account.
(ii) Ronnie’s Account in the books of Annie.
