Simar, Tanvi and Umara were partners in a firm sharing profits and losses in the ratio of 5 : 6 : 9. On 31st March, 2024 their Balance Sheet was as follows:
Balance sheet of Simar Tanvi and Umara as at 31st March 2024
| Liabilities | Amount (₹) | Assets | Amount (₹) | |
|---|---|---|---|---|
| Capitals: | Fixed Assets | 25,00,000 | ||
| Simar | 13,00,000 | Stock | 10,00,000 | |
| Tanvi | 12,00,000 | Debtors | 8,00,000 | |
| Umara | 14,00,000 | 39,00,000 | Cash | 7,00,000 |
| General Reserve | 7,00,000 | Profit and Loss Account 2023-24 | 2,00,000 | |
| Trade Payables | 6,00,000 | |||
| Total | 52,00,000 | Total | 52,00,000 | |
Umara died on 30th June, 2024. The partnership deed provided for the following on the death of a partner:
- Goodwill of the firm be valued at 3 years purchase of average profits for the last 5 years. The profit/loss for the previous four years were:
2022-23: ₹3,10,000 (loss) | 2021-22: ₹3,00,000 (profit) |
2020-21: ₹4,00,000 (profit) | 2019-20: ₹2,50,000 (profit) |
(ii) Umara’s share of profit or loss till the date of her death was to be calculated on the basis of profit or loss for the year ended 31st March 2024.
- Calculate Goodwill of the firm.
- Pass the necessary journal entry for the treatment of goodwill on Umara’s death.
- Calculate Umara’s share in the profit or loss of the firm till the date of her death.
- Pass the necessary journal entry to record Umara’s share of profit or loss till the date of her death.
Marks-4, CBSE: 2024-25/Zone-2/Set-1/Q-22
Answer :
