Illustration 2 Sita, Rita and Meeta are partners sharing profit and losses in the ratio of 2:2:1 Their balance sheet as on March 31, 2017 is as follows: Balance Sheet of Sita, Rita and Meeta as on March 31, 2017 Amount Assets (Rs.) Liabilities General Reserve Creditors Capitals: Sita Rita Meeta 5,000 2,000 1,000 2,500 2,000 8,000 12,500 Cash at bank Stock Furniture Debtors Plant and Machinery Amount (Rs.) 2,500 2,500 1,000 2,000 4,500 12,500 They decided to dissolve the business. The following amounts were realised: Plant and Machinery Rs.4,250, Stock Rs.3,500, Debtors Rs. 1850, Furniture 750. Sita agreed to bear all realisation paid by the firm expenses. For the service Sita is paid Rs.60. Actual expenses on realisation paid by the firm amounted to Rs.450.Creditors paid 2% less. There was an unrecorded assets of Rs.250, which was taken over by Rita at Rs.200. Prepare the necessary accounts to close the books of the firm.

Illustration 2 Sita, Rita and Meeta are partners sharing profit and losses in the ratio of 2:2:1 Their balance sheet as on March 31, 2017 is as follows: Balance Sheet of Sita, Rita and Meeta as on March 31, 2017 Amount Assets (Rs.) Liabilities General Reserve Creditors Capitals: Sita Rita Meeta 5,000 2,000 1,000 2,500 2,000 8,000 12,500 Cash at bank Stock Furniture Debtors Plant and Machinery Amount (Rs.) 2,500 2,500 1,000 2,000 4,500 12,500 They decided to dissolve the business. The following amounts were realised: Plant and Machinery Rs.4,250, Stock Rs.3,500, Debtors Rs. 1850, Furniture 750. Sita agreed to bear all realisation paid by the firm expenses. For the service Sita is paid Rs.60. Actual expenses on realisation paid by the firm amounted to Rs.450.Creditors paid 2% less. There was an unrecorded assets of Rs.250, which was taken over by Rita at Rs.200. Prepare the necessary accounts to close the books of the firm.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

9. On January 1, 2016, AB and QR agreed to form a partnership. The following are their assets and liabilities. Accounts QR P76,000 88,000 48,000 304,000 364,000 480,000 440,000 216,000 144,000 140,000 60,000 Cash Accounts Receivable Inventories Machinery. Accounts Payable Notes Payable AB P136,000 AB decided to pay-off his notes payable from his personal assets. It was also agreed that QR inventories were overstated by P24,000 and AB machinery was over-depreciated P20,000. QR is to invest/withdraw cash in order to receive a capital credit that is 20% more than AB's total net investment in the partnership. Immediately after formation, how much cash will be presented in the partnership' Statement of Financial Position? 9
1 of 1 Class Activity Kand A are partners in a firm. They share profits and the losses in the ratio of 4:1. They decide to dissolve thefirm on March 31,2021, their balance sheet is as follows: Liabilities RO Assets RO Bank loan 8250 Trade mark 6600 Creditors for goods 44000 Machine 66000 Bills payable 2750 Furniture 2200 K's Capital Ac 88000 Stock 33000 A's Capital Ac 33000 Debtors Less: Provision for bad debt 49500-2200 47300 O Cash in hand O Profit & loss Ac 15400 5500 Total 176000 Total 176000 The realization shows the following results: Debtors were realized at book value less 10% Goodwill was sold for 5500 Trade mark was realized for 4400 Machinery and stock were taken over by K for 99000 An unrecorded asset was sold for 1100 A creditor for goods was settled at discount of The expenses on realization were Pass Journal Entries and Prepare Realization A/c, Capital A/cs and Cash/Bank A/c. 440 2200
A, B and C were partners in a busines sharing profits equally, C retires on 1.1.2012, when the Balance Sheet stood as follows: BALANCE SHEET as at 1.1.2012 Liabilities Assets $ Bills Payable 2,000 Cash at Bank 3,750 Creditors 350 Bills Receivable 2,500 General Reserve 7,500 Debtors 6,300 Profit and Loss A/c 3,000 Stock in Trade 700 Capitals - Furniture & Fixtures 4,000 Building & Land Deferred Revenue Expenditure A 7,500 16,350 B 8,250 3,000 8,000 (Advertisement) 36,600 36,600 The goodwill of the firm is valued at $ 11,250. Amount payable to C is transferred to his loan account which will be paid in three equal annual installment together with interest @ 10% p.a. Show the Retiring Partner's Capital Account and his Loan Account till it is paid off. Books of accounts are closed on 31st December every year.
5
QUESTION SIX The following trial balance has been extracted from the books of Gum and Mum as at 31 March 2021; Gum and Mum are in partnership sharing profits and losses in the ratio 3 to 2: Capital accounts: K K Gum 10,000 Mum 5,000 Cash at bank 1,550 Accounts payable 500 Current accounts:…
Need help with this question
Numbers 11-12 (Based on Book Values with Adjustments) On July 1, AA and BB decided to form a partnership. Balance sheet items for AA and BB on July 1 before adjustment are given below: Cash Accounts receivable Inventory Office supplies Equipment Accumulated depreciation Total assets Accounts payable Capital Total liabilities and capital 6,667 withdraw 3,000 invest 8,333 invest AA P 31,000 26,000 32,000 20,000 (9,000) P 100,000 B. AA-81,250 BB-75,000 P 28,000 72,000 P 100.000 C. AA-100,000 BB-75,000 BB P 50,000 20,000 AA and BB agreed to the following adjustments: (a) AA and BB's inventory is to be valued at P31,000 and P22,000, respectively; (b) Accounts receivable of P2,000 in AA's book and P1,000 in BB's books are uncollectible; D. AA 62,000 BB-93,000 24,000 5,000 (c) Accrued salaries of P4,000 for AA and P5,000 for BB are still to be recognized in the books; (d) Unused office supplies of AA amounted to P5,000 while that of BB amounted to P1,500; (e) Prepaid rent of P7,000 and P4,500…
Question 1 Prepare the Statement of Changes in Equity for the year ended 28 February 2021. INFORMATIONThe information given below was extracted from the accounting records of Preston Traders, a partnership business withPresley and Tony as partners. The following must be taken into account:(a) The Statement of Comprehensive Income reflected a net profit of R900 000 on 28 February 2021.(b) The partners are entitled to interest at 12% p.a. on their capital balances.Note: Presley decreased his capital by R200 000 on 01 June 2020 whilst Tony increased his capital by R200 000 on 01 September 2020. These capital changes have been recorded. (d) Tony is entitled to a bonus equal to 5% of the net profit before any of the above appropriations have been taken into account.(e) The remaining profit/loss must be shared between Presley and Tony in the ratio 3:2 respectively.
Ratio Analyses for Victor and Maria Review the financial statements of Victor and Maria Hernandez and the financial ratios provided below. Balance Sheet for a Couple with Two Children-Victor and Maria Hernandez, January 1, 2018 Dollars Percent ASSETS Monetary Assets Cash on hand 1,200 0.3 Savings account 4,200 1.1 Victor's checking account 2,700 0.7 Maria's checking account 3,300 0.8 Tax refund due 700 0.2 Rent receivable 650 0.2 Total Monetary Assets $ 12,750 3.3% Tangible Assets Home 192,000 49.0 Personal property 9,000 2.3 Automobiles 9,500 2.4 Total Tangible Assets $ 210,500 53.7% Investment Assets Fidelity mutual funds 4,000 1.0 Scudder mutual fund 4,500 1.1 Ford Motor Company stock 2,500 0.6 New York 2038 bonds 4,100 1.0 Life insurance cash value 5,400 1.4 IRA accounts 34,400 8.8 Real estate investment 114,000 29.1…
PROBLEM RECOGNITION TASK Determine the maximum deposit insurance coverage by PDIC in the following items. 5. Ronel is a partner of MW Partnership and a stockholder of LG Corporation. He has the following deposit accounts in a closed bank: Ronel’s business (sole proprietorship) P350,000 Ronel’s personal savings account P500,000 Ronel and Jhun and Eff and Karla P600,000 Ronel and MW Partnership P650,000 Ronel and LG Corporation P400,000 What is the maximum deposit insurance coverage as far as Ronel is concerned?
A,B and C were partners sharing profits and losses 2:3:1. The position of the firm as on 1-4-2014 and 31-3-2015 was : 01/04/2014 31/03/2015 01/04/2014 31/03/2015 A's Capital B's Capital C's Capital General Reserve Capital Reserve Bank Overdraft Fixed Assets Debtors Stock Loans and Advances 20,000 18,000 30,000 28,000 40,000 36,000 40,000 37,000 65,000 22,000 10,000 9,000 20,000 30,000 72,000 32,000 12,000 12,000 10,000 1,22,000 5,000 1,52,000 On 1st April, 2014 the partners decided to change their profit and loss sharing ratio to 2:4:1. 1,22,000 1,52,000 Goodwill was valued at $ 42,000. No entries were, however, passed to give effect to this change. Pass Journal entries in the books of the firm as on 31st March, 2015 and prepare Capital Accounts of the Partners.