P, Q & R were partners sharing profits and losses in the ratio of 5:3:2. On 31st Dec. 2012 their Balance Sheet stood as follows: BALANCE SHEET as at 31.12.2012 Liabilities $ Assets 1,40,000 1,40,000 17,500 5,25,000 3,50,000 2,62,500 87,500 15,22,500 Sundry Creditors General Reserve Capitals - Cash at Bank Debtors Stock Machinery Building 1,92,500 1,05,000 5,25,000 4,37,500 2.62,500 12,25,000 Q Patents Goodwill 15,22,500 R died on 31s' March 2013, the following adjustments were made: (a) Goodwill be valued at 2½ years' purchase of the average profits of last four years, The profits for the last four years were as under: 2009 – $ 2,27,000; 2010 – $ 2,10,000; 2011 - $ 2,80,000; 2012 – $ 2,60,000 (b) Machinery be valued at $ 2,90,000; Patents be valued at $ 4,97,500; Building be valued at $ 4,37,500. (c) For the purpose of calculating R's share in the profits, profits of 2013 should be taken to have accrued on the basis of profits of 2012. Calculate the amount payable to the executors of the deceased partner. POR
Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.
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