Question 2:
PRACTICAL PROBLEM
Sheetal, Anjali, Rajendra were sharing profits and losses as 7:5:4. Their Balance sheet as on 31st March, 2011:
Balance Sheet as on 31st March 2012
Rajendra died on 30th June 2012 and the following adjustments were agreed as per deed.
1) Furniture, Machinery and Building are to be revalued at Rs 16,700/-, Rs 16,200, to Rs 30,100.
2) Rajendra’s share is goodwill to be valued from firm’s goodwill which was valued at two times the average profit of last three years. Profits of last three years Rs 30,000, Rs 25,000, Rs 20,000/-.
3) His profit upto the date of death is to be calculated on the basis of last years profit.
4) Rajendra was entitled to get a salary of Rs 800/-per month.
5) Interest on capital at 10% be allowed.
6) Rajendra’s drawing upto date of death were Rs 600 p.m.
Prepare:
1) Rajendra’s Capital A/c showing amount payable to his executor
2) Give working of share of goodwill and profit