Question - 29

The Balance sheet of Shashikant, Suryakant and Ramakant who are sharing profits and losses in proportion of 1/2 : 1/3 : 1/6 respectively was a follows on 30th june 2006.

Liabilies : Bills payable Rs. 6,400, Sundry Creditors Rs. 12,500, Capitals A/c : Shashikant, Suryakant and Ramakant are Rs. 40,000, 25,000 and 20,000 Profit and loss A/c Rs. 4,500.

Asset : Cash in hand Rs. 150, Cash at Bank Rs. 25,500, Bills Receivable Rs. 5,400, Debts Rs. 17,800, Stock book Rs. 22,300, Furniture Rs. 3,500, Plant and Machinery Rs. 9,750 and Buildings Rs. 24,000.

Shashikant retires from the business on 30th june 2006 and his share in the firm is to be ascertained on a revaluation of the assets as follows :

Stock Rs. 20,000, Furniture Rs. 3,000, Plant and Machinery Rs. 9,000. Building Rs. 20,000, Rs, 850 is to be provided for doubtful debts the goodwill of the firm is agreed to be valued at Rs. 6,000.

Shashikant is to be paid Rs. 11,050 in cash on retirement and the balance in three equal yearly installment with interest at 5 per cent annum the firm closes its accounts on 3rd june every year.

Prepare partner's capital A/c & Shashikant loan A/c till final payment was made.

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