Madhav, Raghav and Purav were partners in a firm sharing profits and losses in the ratio of 3:11. Their Balance Sheet as at 31st March, 2023 was as follows:
Balance Sheet of Madhav, Raghav and Purav as at 31st March, 2023
| Liabilities | Amount (Rs.) | Assets | Amount (Rs.) | ||
|---|---|---|---|---|---|
| Creditors General Reserve Capitals: Madhav Raghav Purav |
60,000 1,00,000 40,000 |
1,00,000 50,000 2,00,000 |
Bank Stock Investment Furniture Building |
20,000 1,10,000 70,000 35,000 1,15,000 |
|
| Total | 3,50,000 | Total | 3,50,000 | ||
Purav died on 30th September, 2023. According to Partnership deed, his legal representatives are entitled to the following:
(i) Balance in his Capital Account.
(ii) Share of profit upto the date of death to be calculated on the basis of last year’s profit.
(iii) Share of goodwill calculated on the basis of three years purchase of average profits of last four years.
(iv) Interest on capital @ 12% р.а.
Purav’s share of profit was Rs. 3,000 and the average profit of last four years were Rs. 50,000. Purav’s drawings upto the date of death were Rs.10,000.
Prepare Purav’s Capital Account to be rendered to his legal representatives.
Marks-4, CBSE: 2023-24/Zone-5/Set-1/Q-2
Answer :
