CBSE Class 12 Accountancy — Reconstitution of a Partnership Firm: Admission of a Partner / Retirement of a Partner

(a) Sanjay and Vijay were partners in a firm sharing profits and losses in the ratio of 4 : 3. On 1st April, 2025 they admitted Babul as a new partner for 2/5th share in the profits of the firm. On Babul's admission, the following was agreed upon : (i) The new profit sharing ratio of Sanjay, Vijay and Babul will be 3 : 3 : 4. (ii) The goodwill of the firm will be valued at four years purchase of the average profits of the last three years. The profits of the previous three years were : | Year | Profit (Rs.) | | --- | --- | | 2022-23 | 16,500 | | 2023-24 | 17,500 | | 2024-25 | 18,500 | (iii) Babul will bring his share of goodwill premium in cash, half of which will be withdrawn by Sanjay and Vijay. (iv) On Babul's admission, revaluation of assets and reassessment of liabilities resulted in a loss of Rs. 70,000. (v) At the time of Babul's admission, the firm had a General Reserve of Rs. 28,000. (vi) After making necessary adjustments relating to goodwill, loss on revaluation and general reserve, the capital accounts of Sanjay and Vijay showed balances of Rs. 3,50,000 and Rs. 2,50,000 respectively. Babul brought proportionate capital for his 2/5th share in the profits of the firm. Showing your workings clearly pass necessary journal entries for the above transactions in the books of the firm on Babul's admission. OR (b) Anuj, Divij and Shilpa were partners in a firm sharing profits and losses in the ratio of 2 : 1 : 2. Their Balance Sheet as at 31st March, 2023 was as follows : Balance Sheet of Anuj, Divij and Shilpa as at 31st March, 2023 | Liabilities | Amount (Rs.) | Assets | Amount (Rs.) | | --- | --- | --- | --- | | Capitals : | | Land & Building | 8,00,000 | | Anuj 3,00,000 | | Furniture | 2,40,000 | | Divij 4,00,000 | | Stock | 1,20,000 | | Shilpa 5,00,000 | 12,00,000 | Debtors | 1,70,000 | | Bills Payable | 60,000 | Cash | 50,000 | | Creditors | 1,20,000 | | | | | 13,80,000 | | 13,80,000 | Anuj retired on the above date on the following terms : (i) Anuj's share of goodwill was valued at Rs. 90,000 and the same was to be treated without opening goodwill account. (ii) Revaluation of assets and reassessment of liabilities resulted in a gain of Rs. 25,000. (iii) Amount due to Anuj was transferred to his loan account, to be paid in two equal yearly instalments plus interest @ 12% p.a. on the unpaid balance starting from 31st March, 2024. Prepare Partners' Capital Accounts and Anuj's Loan Account till it is fully discharged.