INDIAN SCHOOL DARSAIT

DEPARTMENT OF COMMERCE
Subject : Accountancy Topic : Death of a Partner Date of Issue:__/__/ 2019
Worksheet No.11
Resource Person: Alexander Gee Varghese Date of Submission:__/__/ 2019

Name of the Student :________________ Class & Division : XII___ Roll Number : __

1. Ram , Manohar and Joshi were partners in a firm . Joshi died on 28 th February, 2015. His share of profit from
the closure of the last accounting year till the date of death was to be calculated on the basis of the average
of three completed years of profits before death. Profits for 2012, 2013 and 2014 were ` 7,000, `8,000 and `
9,000 respectively. Calculate Joshi’s share of profit till his death and pass the necessary Journal entry for the
same.

2. Kala , Mohan and Rawat were partners in a firm . Kala died on 1 st August, 2015. Her share of profit from the
closure of the last accounting year till the date of death was to be calculated on the basis of last year’s Profits
which were ` 24,000.Calculate Kala’s share of profit till her death and pass the necessary Journal entry for
the same. Accounts are closed on 31st March every year.

3. A, B and C are sharing profits in the ratio of 3:2:1. C dies on 31 st March , 2015. Accounts are closed on 31st
December every year. Sales for the year 2014 amounted to ` 6,00,000. Sales from 1st January, 2015 to 31st
March , 2015 amounted to ` 4,80,000. The profit for the year 2014 amounted to Rs 96,000. Calculate the
deceased partner’s share in the current year’s profits and Pass Journal entry.

4. A, B and C are sharing profits in the ratio of 3:2:1. B dies on 31st July, 2015. Accounts are closed on 31st
March every year. Sales for the year 2014-15 amounted to ` 12,00,000. Sales from 1st April, 2015 to 31st July
, 2015 amounted to ` 6,40,000. The profit for the year 2014-15 amounted to ` 2,40,000. Calculate the deceased
partner’s share in the current year’s profits and Pass Journal entry.

5. Chander , Tara and Ravi were partners in a firm sharing profits in the ratio of 2:1:2.On 15.2.2015 Chander
died and the new profit sharing ratio between Tara and Ravi was 4:11. On Chander’s death the goodwill of
the firm was valued at ` 90,000. Calculate gaining ratio and pass necessary journal entry for the treatment
of goodwill on Chander’s death without opening goodwill account.

6. S,T and U were partners in a firm sharing profits in the ratio of 1:2:2. On 15.2.2015 S died and the new profit
sharing ratio of T and U was 3:2. On S’s death the goodwill of the firm was valued at ` 60,000.Calculate the
gaining ratio and pass necessary journal entry on S’s death for the treatment of goodwill without opening
goodwill account.

7. A,B and C were partners sharing profits in the ratio of 3:2:1. B died on 31st March 2016. Under the partnership
deed, the executors of the deceased partner are entitled to :
 His capital as per balance sheet.

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DEPARTMENT OF COMMERCE
 Interest on Capital @ 10% p.a. up to the date of death.
 His share of profit to the date of death, calculated on the basis of last year’s profit.
B’s capital on 31st Dec., 2015 was `40,000 and in 2016 he has withdrawn ` 1,200 per month at the
beginning of each month . Interest on drawing is to be charged @ 10%p.a. Last year’s profit was ` 24,000.
Prepare B’s A/c to be rendered to his executors

8. A,B and C were carrying on business with the following assets with effect from 1.1.2015. Furniture ` 18,000;
Machine ` 72,000; Cash ` 10,000; Debtors ` 20,000. Their profit –sharing ratio was 5:3:2. Capital is also shared
in the same ratio. B died on 30.6.2015. His son claimed his father’s interest in the firm.
The following was the settlement:
(i) Allow his capital to his credit on the date of death.
(ii) Give 5%p.a. interest on his capital.
(iii) He had been drawing @ ` 600 per month which he withdrew at the beginning of each month. He is
allowed to retain these drawings as a part of his share of profit.
(iv) Interest @6% p.a. is charged on his drawings.
(v) Goodwill was evaluated twice the average of profits which were ` 3,600. Prepare B’s Personal Account.

9. Arti , Bharti and Seema are partners sharing profits in the proportion of 3:2:1 and their Balance Sheet on March
31 , 2003 stood as follows:
BALANCE SHEET as at March 31,2018
Liabilities Amount Assets Amount
` `
Bills Payable 12,000 Buildings 21,000
Creditors 14,000 Cash in Hand 12,000
General Reserve 12,000 Bank 13,700
Capitals : Debtors 12,000
Arti 20,000 Bills Receivable 4,300
Bharti 12,000 Stock 1,750
Seema 8,000 40,000 Investment 13,250
78,000 78,000
Bharti died on June 12, 2018 and according to the deed of the said partnership her executors are entitled to
be paid as under:
(i) The capital to her credit at the time of her death and interest thereon @ 10% per annum.
(ii) Her proportionate share of Reserve Fund .
(iii) Her share of profits for the intervening period will be based on the sales during that period, which
were calculated as ` 1,00,000. The rate of profit during past three years had been 10% on sales.
(iv) Goodwill according to her share of profit to be calculated by taking twice the amount of the average
profit of the last three years less 20%. The profits of the previous years were:
2016 ` 8,200
2017 ` 9,000

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 INDIAN SCHOOL DARSAIT
DEPARTMENT OF COMMERCE
2018 ` 9,800
The investments were sold for ` 16,200 and her executors were paid out. Pass the necessary journal
entries and write the account of the executors of Bharti.

10. Nithya , Sathya and Mithya were partners sharing profits and losses in the ratio of 5:3:2 respectively . Their
Balance Sheet as on December 31,2017 was as follows:
Liabilities Amount Assets Amount
` `
Creditors 14,000 Investments 10,000
Reserve Fund 6,000 Goodwill 5,000
Capital Accounts: Premises 20,000
Nithya 30,000 Patents 6,000
Sathya 30,000 Machinery 30,000
Mithya 20,000 80,000 Stock 13,000
Debtors 8,000
Bank 8,000
1,00,000 1,00,000

Mithya dies on 1.5.2018. The agreement between the executors of Mithya and the partners stated that:
(a) Goodwill of the firm be valued at 2 1/2 times the average profits of last four years The profits of four
years were: 2014 ` 13,000; 2015 `12,000; 2016 `16,000 and 2017 ` 15,000.
(b) The patents are to be valued at ` 8,000; Machinery at ` 25,000 and Premises `25,000.
(c) The share of profit of Mithya should be calculated on the basis of the profit of 2017.
(d) ` 4,600 should be paid immediately and the balance should be paid in 4 equal half – yearly instalments
carrying interest @ 10%.
Record the necessary journal entries to give effect to the above and write the executor’s account till the
amount is fully paid. Also prepare the balance sheet of Nithya and Sathya as it would appear on 1.5.2018
after giving effect to the adjustments.

11. Following is the Balance Sheet of A, B and C as on 31st December 2014:

Liabilities ` Assets `
Sundry Creditors 3,000 Tools 1,000
Reserve Fund 3,200 Furniture 8,000
Capital Accounts: Stock 6,000
A 10,000 Debtors 6,000
B 5,000 Cash at Bank 5,000
C 5,000 Cash in hand 200
26,200 26,200
B died on 31st March 2015. Under the partnership agreement the executor of B was entitled to :
(a) Amount standing to the credit of his Capital Account.
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DEPARTMENT OF COMMERCE
(b) Interest on Capital which amounted to ` 62.50.
(c) His share of goodwill ` 3,500.
(d) His share of profit from the closing of the last financial year to the date of death which amounted to
` 437.50.
B ‘s executor was paid ` 1,800 on 1st April 2015 and the balance in four equal yearly installments starting
from 31.3.2016 with interest @6% p.a.
Pass the necessary Journal entries and draw up B’s Account to be rendered to his executor and B’s
Executor’s Account till it is finally paid. Partners were sharing profits and losses in the Capital Ratio.

12. R,S and T were partners sharing profits and losses in the ratio of 5:3:2 respectively. On 31 st Dec.2015, their
B/S stood as under.
Liabilities ` Assets `
Creditors 27500 Goodwill 12500
Reserve Fund 15000 Buildings 50000
Capitals: R 75000 Patents 15000
S 62500 Machinery 75000
T 37500 Stock 25000
Debtors 20000
Cash at bank 20000
217500 217500
T died on 1 May, 2016. It was agreed that:-
st

(a) Goodwill be valued at 2-1/2 years purchase of the average profits of the last four years, which
were -2012 `32500; 2013 `30000; 2014 `40000 and 2015 `37500.
(b) Machinery be valued at `70000, Patents at `20000, Building at `62500.
(c) For the purpose of calculating T’s share in the profits of 2016, previous year profits should
be considered.
(d) A sum of `10, 500 is to be paid immediately to the executors of T and the balance to be paid
in 4 equal half yearly installments together with interest 10%p.a.
Give the necessary journal entries to record the above transactions and T’s executors account
for the year 2016.

13. A,B and C were sharing profits in the ratio of 5:3:2. C died on 1 st Aug.2017. However, their Balance sheet on
31-3-2017 stood as under.
Liabilities ` Assets `
Creditors 21,000 Goodwill 4000
Reserves 6,000 Buildings 44,000
Capital Debtors 5,000 4,900
A 20,000 Less Provision 100
B 15,000 45,000 Stock
C 10,000 8,600
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DEPARTMENT OF COMMERCE
Plant and Machinery 5,500
Furniture 5,000
72,000 72,000
Adjustments:
(i) Goodwill was valued at 2 1/2 years purchase of the average profits of last four years profits. The
profits of last 4 years were: 2014 `13,000, 2015 `12,000, 2016 `16,000 and 2017 `15,000 respectively.
(ii) Buildings were worth `50,000, Stock `10,000.
(iii) Patents unrecorded in the books to be recorded `8,000.
(iv) A reserve of ` 1000 was to be made for doubtful debts.
(v) Profits for the current year were taken on the same basis of last year.
(vi) Amount payable to C to be transferred to his executor’s loan a/c.
Show the necessary ledger account and the Balance sheet of the new firm after C’s death.

14. A and B are partners sharing profits in the ratio of A 5/10, B 3/10 and transfer to reserve 2/10. Their balance
sheet on 31st March, 2016 was as follows:
` `
Sundry Creditors 16,000 Cash at Bank 2,800
General Reserve 9,600 Sundry Debtors 20,000
A 80,000 B/R 8,000
B 40,200 1,20,200 Fixed Assets 1,00,000
Goodwill 15,000
1,45,800 1,45,800
B died on 1 April,2016. Besides his Capital and Reserves, B’s legal representatives are
st

entitled to:
(i). His share of goodwill , based on two years of the total profits of last three years, which were `10,300;
`15,100 and `13,600.
Assets were revalued as follows:
Fixed Assets ` 1,20,000; ` 2,000 out of debtors are bad and a provision of 5% is to be made for bad debts
and 2% for discount on debtors Prepaid insurance is ` 490 and outstanding salaries ` 3,000. There is an old
typewriter not recorded in the books valued at `4,000.
Prepare Revaluation a/c and B’s a/c to be rendered to his legal representatives.

15. Dinesh, Rajesh and Mahesh shared profits as 5:3:2.Their Balance Sheet as on March 31, 2018 was as follows:
-
BALANCE SHEET AS AT MARCH 31,2018
Liabilities Amount ` Assets Amount `
Creditors 50,000 Goodwill 5,000
Profit and Loss A/c 10,000 Cash 17,000
General Reserve 40,000 Fixed Assets 60,000
Capital Accounts: Investments 20,000
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DEPARTMENT OF COMMERCE
Dinesh 30,000 Stock 45,500
Rajesh 30,000 Debtors 30,000
Mahesh 40,000 1,00,000 B/R 6,000

Deferred Revenue 14,000

Expenditure
Dinesh’s loan account 2,500
2,00,000 2,00,000
Dinesh died on July 1, 2018. Rajesh and Mahesh decided to share profits equally after Dinesh’s death. The
executors of Dinesh will get:-
(i) His share of goodwill. The total goodwill of the firm valued at `50,000.
(ii) His share of profit up to his date of death on the basis of average profits of last three years
March 31, 2018 `25,000
March 31 2017 `18,000
March 31, 2016 `17,000
(iii) Fixed Assets were undervalued by `3,000.a provision @ 5% on debtors is to be created for doubtful
debts.
(iv) Investment were sold for `25,000. Half of the amount due to Dinesh was paid to his executors and
for the balance they accepted a Bills Payable.
Prepare necessary ledger accounts and the new Balance sheet.
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