Trisha, Urvi and Varsha were partners in a firm sharing profits and losses in the ratio of 5 : 4 : 1. Their Balance Sheet as at 31st March, 2023 was as follows:
Balance Sheet of Trisha, Urvi and Varsha as at 31st March, 2023
Liabilities | Amount (₹) | Assets | Amount (₹) |
---|---|---|---|
Capitals : Trisha 2,00,000 Urvi 1,30,000 Varsha 1,00,000 General Reserve Creditors |
Fixed Assets | 4,00,000 | |
Stock | 1,00,000 | ||
Debtors | 1,50,000 | ||
4,30,000 | Cash | 2,00,000 | |
1,50,000 | |||
2,70,000 | |||
8,50,000 | 8,50,000 |
Trisha retired on 1st April, 2023 and the partners agreed to the following terms:
(i) Fixed Assets were found overvalued by ₹ 80,000.
(ii) Stock was taken over by Trisha at ₹ 80,000.
(iii) Goodwill of the firm was valued at ₹ 1,00,000 on Trisha’s retirement and Trisha’s share by goodwill was adjusted through the Capital Accounts of remaining partners.
(iv) New profit sharing ratio between the remaining partners was agreed at 2:3.
(v) Trisha was paid ₹ 50,000 on retirement and the balance was transferred to her loan account.
Pass necessary journal entries in the books of the firm on Trisha’s retirement.
Marks-6, CBSE: 2023-24/Compartment/Set-1/Q-26b*
Answer :