Dinesh, Alvin and Pramod are partners in a firm sharing profits and losses in the ratio of 5:3:2. Their Balance Sheet as at March 31, 2018 was as follows: –
Balance Sheet of Dinesh, Alvin and Pramod
As at 31st March, 2018
Liabilities | Amount (Rs.) | Assets | Amount (Rs.) |
Sundry Creditors | 50,000 | Debtors | 15,000 |
General Reserve | 40,000 | Fixed Assets | 67,000 |
Bills Payable | 10,000 | Investments | 40,000 |
Dinesh’s Capital | 30,000 | Stock | 25,500 |
Alvin’s Capital | 40,000 | Cash in Hand | 36,000 |
Pramod’s Capital | 30,000 | Deferred Revenue Expenditure | 14,000 |
Total | 2,00,000 | Total | 2,00,000 |
Dinesh died on July 1, 2018, The executors of Dinesh are entitled to:-
- i. His share of goodwill. The total goodwill of the firm valued at ₹50,000.
- His share of profit up to his date of death on the basis of actual sales till date of death. Sales for the year ended March 31, 2018 was ₹ 12, 00,000 and profit for the same year was ₹ 2,00,000. Sales shows a growth trend of 20% and percentage of profit earning remains the same.
iii. Investments were sold at par. Half of the amount due to Dinesh was paid to his executors and for the balance, they accepted a Bills Payable.
Prepare Dinesh’s Capital account to be rendered to his executors.
Marks-4, CBSE:2018-19/Sample/Q-12