CBSE Class 12 Accountancy sample paper 2024-25: question 24(a)
From the official CBSE sample question paper for 2024-25, section A, question 24(a), for 6 marks. Try it first; the hints and our step-by-step solution are below.
Q24(a) · 6 marks · Long answerReconstitution of a Partnership Firm – Retirement/Death of a Partner
Meghna, Mehak and Mandeep were partners in a firm whose Balance Sheet as on 31st March, 2023 was as under:
Balance Sheet
| Liabilities | Amount | Assets | Amount |
|---|---|---|---|
| Creditors | 28,000 | Cash | 27,000 |
| General Reserve | 7,500 | Debtors | 20,000 |
| Capitals: Meghna 20,000; Mehak 14,500; Mandeep 10,000 | 44,500 | Stock | 28,000 |
| Furniture | 5,000 | ||
| 80,000 | 80,000 |
Mehak retired on this date under following terms:
(i) To reduce stock and furniture by 5% and 10% respectively.
(ii) To provide for doubtful debts at 10% on debtors.
(iii) Goodwill was valued at ₹12,000.
(iv) Creditors of Rs.8,000 were settled at Rs.7,100.
(v) Mehak should be paid off and the entire sum payable to Mehak shall be brought in by Meghna and Mandeep in such a way that their capitals should be in their new profit-sharing ratio and a balance of Rs.25,000 is maintained in the cash account.
Prepare Revaluation Account and partners’ capital accounts of the new firm.
Source: official sample paper from cbseacademic.nic.in (PDF). See it in the full Sample paper 2024-25.
Hints
Open one hint at a time and try again before the next.
Hint 1
With no ratio given, profits and losses are shared equally.
Hint 2
Work out the cash needed after paying the creditors and Mehak, so that ₹ 25,000 remains.
Hint 3
Equal new capitals: total adjusted capital plus cash brought in, split in half.
Step-by-step solution
Each step shows the marks it earns, as an examiner would award them. Checked by an independent re-solve from the question paper.
- 2 marks
Revaluation Account (no ratio is given, so partners share equally)
Particulars ₹ Particulars ₹ To Stock A/c (5%) 1,400 By Creditors A/c (8,000 − 7,100) 900 To Furniture A/c (10%) 500 By Loss transferred to: To Provision for Doubtful Debts A/c 2,000 Meghna's Capital A/c 1,000 Mehak's Capital A/c 1,000 Mandeep's Capital A/c 1,000 3,900 3,900 - 1½ marks
Workings. General reserve ₹ 2,500 each. Mehak's share of goodwill = ₹ 12,000 × 1/3 = ₹ 4,000, paid ₹ 2,000 each by Meghna and Mandeep. Mehak is due ₹ 14,500 + 2,500 + 4,000 − 1,000 = ₹ 20,000. Cash before new money = 27,000 − 7,100 − 20,000 = −₹ 100, so ₹ 25,100 must come in to leave ₹ 25,000. Capitals before that: Meghna ₹ 19,500, Mandeep ₹ 9,500; total ₹ 54,100 in equal shares = ₹ 27,050 each, so Meghna brings ₹ 7,550 and Mandeep ₹ 17,550.
- 2½ marks
Partners' Capital Accounts
Particulars Meghna (₹) Mehak (₹) Mandeep (₹) Particulars Meghna (₹) Mehak (₹) Mandeep (₹) To Revaluation A/c 1,000 1,000 1,000 By Balance b/d 20,000 14,500 10,000 To Mehak's Capital A/c 2,000 2,000 By General Reserve A/c 2,500 2,500 2,500 To Cash A/c 20,000 By Meghna's Capital A/c 2,000 To Balance c/d 27,050 27,050 By Mandeep's Capital A/c 2,000 By Cash A/c 7,550 17,550 30,050 21,000 30,050 30,050 21,000 30,050
Answer: Revaluation loss ₹ 3,000 (₹ 1,000 each); Mehak paid ₹ 20,000; Meghna brings ₹ 7,550 and Mandeep ₹ 17,550; closing capitals ₹ 27,050 each
Where the marks are
- Revaluation Account (2 marks)
- Goodwill, amount due and cash needed (1½ marks)
- Partners' capital accounts (2½ marks)
Revise the chapter
- Chapter: Reconstitution of a Partnership Firm – Retirement/Death of a Partner (notes, formulas, where marks are lost and every past question)
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