Accountancy

SOLUTION Profit and Loss Suspense Account

SOLUTION Remaining Partner s Capital A/cs                               Dr.       (In Gaining Ratio)   To Retiring or Deceased Partner’s Capital A/cs(With his share of goodwill)

SOLUTION Retiring partner is entitled to goodwill according to his share of profit in the firm.

SOLUTION Accumulated profits are credited to the Capital Accounts of old partners in their old ratio and accumulated losses are debited to their Capital Accounts in old ratio.

SOLUTION ‘Gaining Ratio’ is the ratio in which the retiring partner’s share is acquired by continuing partners. It is computed by deducting old ratio from the new ratio.

SOLUTION Retirement of a partner is one of the modes of reconstituting the firm under which the existing partnership deed comes to an end and in its place a new…

SOLUTION New Ratio: 15: 16: 5: 12Working:B' s share = 2 / 6; D' s share =1 / 6; Remaining Share = 1 – 2 / 6 – 1 /…

SOLUTION Yes, the accountant is correctWorking: c’s Share acquired from A and B each = 1 / 5 x 1 / 2 = 1 / 10A's Share = 3 /…

SOLUTION New Ratio 9: 4: 3: 4