Doubts

Riyansh, Garv and Kavleen were partners in a firm sharing profit and loss in the ratio of 8: 7: 5. On 2nd November, 2018, Kavleen died. Kavleen’s share of profits till the date of her death was calculated at Rs. 9,375. Pass the necessary journal entry. (CBSE Sample Paper 2019)

SOLUTION Journal DateParticularsL.FAmount (Dr.)Amount (Cr.)2018Nov 2Profit & Loss A/c Dr.    To Kavleen’s Capital A/c(Kavleen’s Share of Profit up to the date of her death transferred to her capital A/c) 9375 …

Continue ReadingRiyansh, Garv and Kavleen were partners in a firm sharing profit and loss in the ratio of 8: 7: 5. On 2nd November, 2018, Kavleen died. Kavleen’s share of profits till the date of her death was calculated at Rs. 9,375. Pass the necessary journal entry. (CBSE Sample Paper 2019)

Diya, Riya and Tiya were partners sharing profits and losses in the ratio of 2: 3: 5. Tiya died on 28th November, 2019. Her share of profit was taken equally by Diya and Riya. Diya’s share of profit in the new firm will be__. (C.B.S.E. 2020)

SOLUTION Diya's share of profit in the new firm will be 9 / 20.Working Note:Diya's New Profit Share = Old Profit Share + Profit Share TakenDiya's New Profit Share =…

Continue ReadingDiya, Riya and Tiya were partners sharing profits and losses in the ratio of 2: 3: 5. Tiya died on 28th November, 2019. Her share of profit was taken equally by Diya and Riya. Diya’s share of profit in the new firm will be__. (C.B.S.E. 2020)

State the basis of calculating the amount of profit payable to the legal representative of a deceased partner in the year of death. (C.B.S.E. 2019)

SOLUTION Amount of Profit may be estimated on the basis of: (a) Last year's profit / average profit of last given no. of years; (b)Turnover Sales

Continue ReadingState the basis of calculating the amount of profit payable to the legal representative of a deceased partner in the year of death. (C.B.S.E. 2019)

Differentiate between ‘Profit & Loss Appropriation Account’ and ‘Profit & Loss Suspense Account’. (Delhi and Al 2015 C)

SOLUTION Profit & loss Appropriation Account is prepared to show the distribution of Net Profit among the partners. Profit & Loss Suspense Account is prepared to adjust the Deceased Partner's…

Continue ReadingDifferentiate between ‘Profit & Loss Appropriation Account’ and ‘Profit & Loss Suspense Account’. (Delhi and Al 2015 C)