A assignment of accounts for class 12th on the topic death of a partner

1. DEATH OF A PARTNER
Kuhu, Sheeba and Jigyasa were partners in a firm sharing profits in the ratio of 5: 2: 3.
On 31st December, 2018 the balance sheet of Kuhu , Sheeba and Jigyasa was as
follows:
BALANCESHEET
As on 31st
December, 2018
LIABILITIES AMOUNT(Rs.) ASSETS AMOUNT(Rs.)
Capitals:
Kuhu 5,00,000
Sheeba 2,00,000
Jigyasa 3,00,000
General Reserve
Loan from Sheeba
Creditors
10,00,000
1,50,000
1,00,000
50,000
Goodwill
Land and Building
Machinery
Stock
Debtors
Cash
Profit and Loss
3,50,000
4,75,000
2,00,000
50,000
1,25,000
40,000
60,000
13,00,000 13,00,000
On 14th March 2019, Sheeba died. The partnership deed provided that on the death of
a partner the executor of the deceased partner is entitled to
(i) Balance in capital account.
(ii) Share in profits upto the date of death on the basis of last year’s profit.
(iii) Her share in profit/loss on revaluation of assets and re-assessment of liabilities
which were as follows
(a) Land and building was to be appreciated by Rs. 1, 25,000.
(b) Machinery was to be depreciated to Rs. ,20,000 and stock to Rs. 10,000.
(c) A provision of 3% for bad and doubtful debts was to be created on debtors.

2. (d) The net amount payable to Sheeba’s executors was transferred to her loan account
which was to be paid later.
Prepare revaluation account, partners’ capital account, Sheeba’s executor’s account
and balance sheet of Kuhu and Jigyasa who decided to continue the business keeping
their capital balances in their new profit sharing ratio.
SOLUTION:
REVALUTION ACCOUNT
PARTICULARS AMOUNT(Rs.) PARTICULARS AMOUNT(Rs.)
To machinery A/c
To stock A/c
To PDD
To Profit transferred to:
Kuhu’s Cap 45,625
Sheeba’s Cap 18,250
Jigyasa’s Cap 27,375
20,000
10,000
3,750
91,250
By Land and Building 1,25,000
1,25,000 1,25,000
PARTNER’S CAPITAL ACCOUNT
PARTICULARS KUHU SHEEBA JIGYASA PARTICULARS KUHU SHEEBA JIGYASA
To Goodwill A/c
To Profit and
Loss A/c
To Profit and
Loss Suspense
A/c(Loss)
To Sheeba’s
Executors A/c
To Balance c/d
1,75,000
30,000
-
-
4,15,625
70,000
12,000
2,800
1,63,450
-
1,05,000
18,000
-
-
2,49,375
By balance b/d
By Revaluation
A/c (Profit)
By General
Reserve A/c
5,00,000
45,625
75.000
2,00,000
18,250
30,000
3,00,000
27,375
45,000
6,20,625 2,48,250 3,72,375 6,20,625 2,48,250 3,72,375

3. BALANCESHEET
As on 14th march,2019
SHEEBA’S EXECUTOR’S ACCOUNT
PARTICULARS AMOUNT(Rs.) PARTICULARS AMOUNT(Rs.)
To Sheeba’s Executor’s
Loan A/c
2,63,450 By Sheeba’s Capital
By Sheeba’s loan A/c
1,63,450
1,00,000
2,63,450 2,63,450
WORKING NOTE:
1. Calculation of Sheeba’s share of profit:
Number of days Sheeba worked for(jan=feb+mar)= 31+28+14= 73 days
Share of Sheeba’s Profit = 70,000 x 73/365 x 2/10 = Rs.2,800
LIABILITIES AMOUNT(Rs.) ASSETS AMOUNT(Rs.)
Capitals:
Kuhu 4,15,625
Jigyasa 2,49,375
Creditors
Sheeba’s Executor’s
Loan A/c
Profit and Loss Suspense
A/c
6,65,000
50,000
2,63,450
2,800
Land and building
Machinery
Stock
Debtors 1,25,000
Less: PDD (3,750)
Cash
6,00,000
1,80,000
40,000
1,21,250
40,000
9,81,250 9,81,250