A, B, and C are partners and sharing profits 2/5thand 1/5th respectively. The balance sheet on31st December, 2008, is as follows:-
Liabilities
Rs
Assets
Rs
Creditors
29000
Cash at Bank
4000
Capital-A
30000
Debtors
30000
Capital-B
20000
Stock
45000
Capital-C
20000
Plant & Fixtures
20000
Total
99000
Total
99000
âCâ dies on1st September, 2009 and the deed provides that theestate of the deceased shall be entitled to a share of the profitsup to the date of death based on the profits of the previous year,together with a share in repect of goodwill to be calculated on thebasis of two years purchase of the average net profits of theprevious three years. The net profits for the years 2006, 2007 and2008 were Rs20,000, Rs22000 and Rs18000 respectively. Six percentinterest was agreed to be credited on the capital of each partner.C has withdrawn Rs1500 from the date of the last balance sheet tothe date of his death. The whole amount due to the deceased as at1st September, 2009 was to be temporarily credited tohis loan account opened in the name of the Executors. Show detailworking and the amount to be credited.
A, B, and C are partners and sharing profits 2/5thand 1/5th respectively. The balance sheet on31st December, 2008, is as follows:-
Liabilities | Rs | Assets | Rs |
Creditors | 29000 | Cash at Bank | 4000 |
Capital-A | 30000 | Debtors | 30000 |
Capital-B | 20000 | Stock | 45000 |
Capital-C | 20000 | Plant & Fixtures | 20000 |
Total | 99000 | Total | 99000 |
âCâ dies on1st September, 2009 and the deed provides that theestate of the deceased shall be entitled to a share of the profitsup to the date of death based on the profits of the previous year,together with a share in repect of goodwill to be calculated on thebasis of two years purchase of the average net profits of theprevious three years. The net profits for the years 2006, 2007 and2008 were Rs20,000, Rs22000 and Rs18000 respectively. Six percentinterest was agreed to be credited on the capital of each partner.C has withdrawn Rs1500 from the date of the last balance sheet tothe date of his death. The whole amount due to the deceased as at1st September, 2009 was to be temporarily credited tohis loan account opened in the name of the Executors. Show detailworking and the amount to be credited.
