Unit 3: Reconstitution of a Partnership Firm – Retirement/Death of a Partner · NCERT · Class 12 · Accountancy · Part 1

Q1Written answer

Aparna, Manisha and Sonia are partners sharing profits in the ratio of 3:2:1. Manisha retires, and the goodwill of the firm is valued at ₹ 1,80,000. Aparna and Sonia decided to share the future in the ratio of 3:2. Pass necessary Journal entries.

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Books of Aparna and Sonia Journal
Date	Particulars		L.F.	Amount ₹	Amount ₹
	Aparna’s Capitals A/c	Dr.		18,000
	Sonia’s Capital A/c	Dr.		42,000
	To Manisha’s Capital A/c				60,000
	(Manisha’s share of goodwill adjusted to Aparna’s and Sonia’s Capital Account in their gaining ratio )

Working Notes:

i. Manisha’s share in goodwill:

Total goodwill of the firm × Retiring partner’s share =
Chp 4-3

ii. Gaining Ratio = New Ratio − Old Ratio

Aparna Gaining share
Chp 4-4

Chp 4-5

Gaining Ratio between Aparna and Sonia = 3: 7

iii. Aparna’s share in the goodwill
Chp 4-6

Sonia’s share in the goodwill

Q2Written answer

Sangeeta, Saroj and Shanti are partners sharing profits in the ratio of 2:3:5. Goodwill is appearing in the books at a value of ₹ 60,000. Sangeeta retires, and goodwill is valued at ₹ 90,000. Saroj and Shanti decided to share future profits equally. Record necessary Journal entries.

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Books of Saroj and Shanti Journal
Date	Particulars		L.F.	Amount ₹	Amount ₹
	Sangeeta’s Capital A/c	Dr.		12,000
	Saroj’s Capital A/c	Dr.		18,000
	Shanti’s Capital A/c	Dr.		30,000
	To Goodwill A/c				60,000
	(Goodwill written off)

	Saroj’s Capital A/c	Dr.		18,000
	To Sangeeta’s Capital A/c				18,000
	(Sangeeta’s share of goodwill adjusted to Saroj’s Capital Account in her gaining ratio)

Working Notes:

i. Sangeeta’s share of goodwill

Total goodwill of the firm × Retiring partner’s share

ii. Gaining Ratio = New Ratio – Old Ratio

Saroj’s Gaining Share

Shanti’s Gaining Share

Q3Written answer

Himanshu, Gagan and Naman are partners sharing profits and losses in the ratio of 3:2:1. On March 31, 2017, Naman retires.

The various liabilities and assets of the firm on the date were as follows:

Cash ₹ 10,000, Building ₹ 1,00,000, Plant and Machinery ₹ 40,000, Stock ₹ 20,000, Debtors ₹ 20,000 and Investments ₹ 30,000.

The following was agreed upon between the partners on Naman’s retirement:

(i)	Building to be appreciated by 20%.
(ii)	Plant and Machinery are to be depreciated by 10%.
(iii)	A provision of 5% on debtors is to be created for bad and doubtful debts.
(iv)	The stock is to be valued at ₹ 18,000 and the investment at ₹ 35,000.

Record the necessary journal entries to the above effect and prepare the Revaluation Account.

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Books of Himanshu and Gagan Journal
Date	Particulars		L.F.	Amount ₹	Amount ₹
	Building A/c	Dr.		20,000
	Investment A/c	Dr.		5,000
	To Revaluation A/c	Dr.			25,000
	(Value of Building and Investment increased at the time of Naman’s retirement)

	Revaluation A/c	Dr.		7,000
	To Plant and Machinery A/c				4,000
	To Provision for Bad and Doubt Debts A/c				1,000
	To Stock A/c				2,000
	(Assets revalued and provision for Bad and Doubtful Debts made at the time of Naman’s retirement)

	Revaluation A/c	Dr.		18,000
	To Himanshu’s Capital A/c				9,000
	To Gagan’s Capital A/c				6,000
	To Naman’s Capital A/c				3,000
	(Profit on revaluation transferred to all Partners’ Capital Accounts in their old profit-sharing ratio)

Revaluation Account
Dr.				Cr.
Particular		Amount ₹	Particular	Amount ₹
Plant and Machinery		4,000	Building	20,000
Stock		2,000	Investment	5,000
Provision for Bad and Doubtful Debts		1,000
Profit Transferred to Capital Account:
Himanshu	9,000
Gagan	6,000
Naman	3,000	18,000
		25,000		25,000

Q4Written answer

Naresh, Raj Kumar and Bishwajeet are equal partners. Raj Kumar decides to retire. On the date of his retirement, the Balance Sheet of the firm showed the following:

General Reserve – ₹ 36,000

Profit and Loss Account (Dr.) – ₹ 15,000.

Pass the necessary journal entries to the above effect.

Books of Naresh and Bishwajeet Journal
Date	Particulars		L.F.	Amount ₹	Amount ₹
	General Reserve A/c	Dr.		36,000
	To Naresh’s Capital A/c				12,000
	To Raj Kumar’s Capital A/c				12,000
	To Bishwajeet’s Capital A/c				12,000
	(General Reserve distributed among old partners in old ratio)

	Naresh’s Capital A/c	Dr.		5,000
	Raj Kumar’s Capital A/c	Dr.		5,000
	Bishwajeet’s Capital A/c	Dr.		5,000
	To Profit and Loss A/c				15,000
	(Debit balance of Profit and Loss Account written off)

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Solution coming soon.

Q5Written answer

Digvijay, Brijesh and Parakaram were partners in a firm, sharing profits in the ratio of 2:2:1. Their Balance Sheet as on March 31, 2017, was as follows:

Liabilities	Amount ₹	Assets	Amount ₹
Creditors	49,000	Cash	8,000
Reserves	18,500	Debtors	19,000
Digvijay’s Capital	82,000	Stock	42,000
Brijesh’s Capital	60,000	Buildings	2,07,000
Parakaram’s Capital	75,500	Patents	9,000
	2,85,000		2,85,000

Brijesh retired on March 31, 2017, on the following terms:

(i) Goodwill of the firm was valued at ₹ 70,000 and was not to appear in the books.

(ii) Bad debts amounting to ₹ 2,000 were to be written off.

(iii) Patents were considered valueless.

Prepare the Revaluation Account, Partners’ Capital Accounts and the Balance Sheet of Digvijay and Parakaram after Brijesh’s retirement.

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Books of Digvijay and Parakaram Revaluation Account
Dr.			Cr.
Particular	Amount ₹	Particular		Amount ₹
Bad Debts	2,000
Patents	9,000	Loss Transferred to Capital Account:
		Digvijay		4,400
		Brijesh		4,400
		Parakaram		2,200

	11,000			11,000

Partners’ Capital Account
Dr.					Cr.
Particulars	Digvijay	Brijesh	Parakaram	Particulars		Digvijay	Brijesh	Parakaram
Brijesh’s Capital A/c	18,667		9,333	Balance b/d		82,000	60,000	75,500
Revaluation (Loss)	4,400	4,400	2,200	Digvijay’s Capital A/c			18,667
Brijesh’s Loan		91,000		Parakaram’s Capital A/c			9,333
Balance c/d	66,333		67,667	Reserves		7,400	7,400	3,700
	89,400	95,400	79,200			89,400	95,400	79,200

Balance Sheet as on March 31, 2017
Liabilities	Amount ₹	Assets		Amount ₹
Creditors	49,000	Cash		8,000
Brijesh’s Loan	91,000	Debtors	19,000
		Less: Bad Debts	2,000	17,000
Digvijay’s Capital A/c	66,333	Stock		42,000
Parakaram’s Capital A/c	67,667	Buildings		2,07,000
	2,74,000			2,74,000

Note: As the sufficient balance is not available to pay the amount due to Brijesh, the balance of his Capital Account is transferred to his Loan Account.

Working Note:

1. Brijesh’s Share of Goodwill

Total goodwill of the firm × Retiring partner’s share

2. Gaining Ratio = New Ratio – Old Ratio

Digvijay’s Share

Parakaram’s Share

Gaining ratio between Digvijay and Parakaram = 4:2 or 2:1

Q6Written answer

Radha, Sheela and Meena were in partnership, sharing profits and losses in the proportion of 3:2:1. On April 1, 2017, Sheela retired from the firm. On that date, their Balance Sheet was as follows:

Liabilities		Amount ₹	Assets	Amount ₹
Trade Creditors		3,000	Cash-in-Hand	1,500
Bills Payable		4,500	Cash at Bank	7,500
Expenses Owing		4,500	Debtors	15,000
General Reserve		13,500	Stock	12,000
Capitals:			Factory Premises	22,500
Radha	15,000		Machinery	8,000
Sheela	15,000		Loose Tools	4,000
Meena	15,000	45,000
		70,500		70,500

The terms were:

a) Goodwill of the firm was valued at ₹ 13,500.

b) Expenses owing to be brought down to ₹ 3,750.

c) Machinery and Loose Tools are to be valued at 10% less than their book value.

d) Factory premises are to be revalued at ₹ 24,300.

Prepare:

i. Revaluation account

ii. Partner’s capital accounts

iii. Balance sheet of the firm after the retirement of Sheela.

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Books of Radha and Meena Revaluation Account
Dr.			Cr.
Particulars		Amount ₹	Particulars	Amount ₹
Machinery		800	Expenses Owing	750
Loose Tools		400	Factory Premises	1,800
Profit transferred to Capital Account:
Meena	675
Radha	450
Sheela	225	1,350
		2,550		2,550

Parters’ Capital Account
Dr.				Cr.
Particulars	Radha	Sheela	Meena		Particulars	Radha	Sheela	Meena
Sheela’s Capital A/c	3,375		1,125		Balance b/d	15,000	15,000	15,000
Sheela’s Loan A/c		24,450			General Reserve	6,750	4,500	2,250
Balance c/d	19,050		16,350		Revaluation (Profit)	675	450	225
					Radha’s Capital A/c		3,375
					Meena’s Capital A/c		1,125
	22,425	24,450	17,475			22,425	24,450	17,475

Balance Sheet as on April 01, 2017
Liabilities		Amount ₹	Assets		Amount ₹
Trade Creditors		3,000	Cash in Hand		1,500
Bills Payable		4,500	Cash at Bank		7,500
Expenses Owing		3,750	Debtors		15,000
Sheela’s Loan		24,450	Stock		12,000
			Factory Premises		24,300
Capitals:			Machinery	8,000
Radha	19,050		Less: 10%	(800)	7,200
Meena	16,350	35,400	Loose Tools	4,000
			Less: 10%	(400)	3,600
		71,100			71,100

Working Notes:

1) Sheela’s share of goodwill

Total goodwill of the firm × Retiring partner’s share =13,500 × 2/6 = 4,500

2) Gaining Ratio = New Ratio − Old Ratio

Radha’s Share
Chp 4-14

Meena’s Shares
Chp 4-15

Gaining Ratio between Radha and Meena = 6:2 or 3:1

Q7Written answer

Pankaj, Naresh and Saurabh are partners sharing profits in the ratio of 3:2:1. Naresh retired from the firm due to his illness. On that date, the Balance Sheet of the firm was as follows:

Books of Pankaj, Naresh and Saurabh
Balance Sheet as on March 31, 2017
Liabilities		Amount ₹	Assets		Amount ₹
General Reserve		12,000	Bank		7,600
Sundry Creditors		15,000	Debtors	6,000
Bills Payable		12,000	Less: Provision for Doubtful Debt	400	5,600
Outstanding Salary		2,200
Provision for Legal Damages		6,000	Stock		9,000
Capitals:			Furniture		41,000
Pankaj	46,000		Premises		80,000
Naresh	30,000
Saurabh	20,000	96,000
		1,43,200			1,43,200

Additional Information

(i) Premises have appreciated by 20%, stock depreciated by 10% and provision for doubtful debts was to be made 5% on debtors. Further, provision for legal damages is to be made for ₹ 1,200 and furniture to be brought up to ₹ 45,000.

(ii) Goodwill of the firm is valued at ₹ 42,000.

(iii) ₹ 26,000 from Naresh’s Capital account be transferred to his loan account, and the balance is paid through the bank; if required, the necessary loan may be obtained from the bank.

(iv) New profit-sharing ratio of Pankaj and Saurabh is decided to be 5:1.

Give the necessary ledger accounts and balance sheet of the firm after Naresh’s retirement.

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Revaluation Account
Dr.			Cr.
Particulars		Amount ₹		Particulars	Amount ₹
Stock		900		Premises	16,000
Provision for Legal Damages		1,200		Provision for Doubtful Debts	100
Profit Transferred to Capital:				Furniture	4,000
Pankaj	9,000
Naresh	6,000
Saurabh	3,000	18,000
		20,100			20,100

Partners’ Capital Accounts
Dr.				Cr.
Particulars	Pankaj	Naresh	Saurabh		Particulars	Pankaj	Naresh	Saurabh
Naresh’s Capital A/c	14,000				Balance b/d	46,000	30,000	20,000
Naresh’s Loan A/c		26,000			General Reserve	6,000	4,000	2,000
Bank		28,000			Revaluation (Profit)	9,000	6,000	3,000
Balance c/d	47,000		25,000		Pankaj’s Capital A/c		14,000
	61,000	54,000	25,000			61,000	54,000	25,000

Bank Account
		Cr.
Particulars	Amount ₹	Particulars	Amount ₹
Balance b/d	7,600	Naresh’s Capital A/c	28,000
Bank Loan (Balancing Figure)	20,400

	28,000		28,000

Balance Sheet as on March 31, 2017
Liabilities		Amount ₹	Assets		Amount ₹
Sundry Creditors		15,000	Debtors	6,000
Bills Payable		12,000	Less: Provision for Doubtful Debts	300	5,700
Bank Loan/overdraft		20,400	Stock		8,100
Outstanding Salaries		2,200	Furniture		45,000
Provision for Legal Damages		7,200	Premises		96,000
Naresh’s Loan		26,000
Capitals:
Pankaj	47,000
Saurabh	25,000	72,000
		1,54,800			1,54,800

Q8Written answer

Puneet, Pankaj and Pammy are partners in a business, sharing profits and losses in the ratio of 2:2:1, respectively. Their balance sheet as on March 31, 2017, was as follows:

Books of Puneet, Pankaj and Pammy
Balance Sheet as on March 31, 2017
Liabilities		Amount ₹	Assets	Amount ₹
Sundry Creditors		1,00,000	Cash at Bank	20,000
Capital Accounts:			Stock	30,000
Puneet	60,000		Sundry Debtors	80,000
Pankaj	1,00,000		Investments	70,000
Pammy	40,000	2,00,000	Furniture	35,000
Reserve		50,000	Buildings	1,15,000
		3,50,000		3,50,000

Mr Pammy died on September 30, 2017. The partnership deed provided the following:

(i)

The deceased partner will be entitled to his share of profit up to the date of death calculated on the basis of the previous year’s profit.

(ii)

He will be entitled to his share of goodwill of the firm calculated on the basis of 3 years’ purchase of an average of the last 4 years’ profit. The profits for the last four financial years are given below: for 2013–14, ₹ 80,000; for 2014–15, ₹ 50,000; for 2015–16, ₹ 40,000; for 2016–17, ₹ 30,000.

The drawings of the deceased partner up to the date of death amounted to ₹ 10,000. Interest on capital is to be allowed at 12% per annum.

Surviving partners agreed that ₹ 15,400 should be paid to the executors immediately and the balance in four equal yearly instalments with interest at 12% p.a. on the outstanding balance.

Show Mr Pammy’s Capital account, and his Executor’s account, till the settlement of the amount due.

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Pammy’s Capital Account
Dr.		Cr.
Particulars	Amount ₹		Particulars	Amount ₹
Drawings	10,000		Balance b/d	40,000
Pammy Executor’s A/c	75,400		Profit and Loss (Suspense)	3,000
			Puneet’s Capital A/c	15,000
			Pankaj’s Capital A/c	15,000
			Interest on Capital	2,400
			Reserve	10,000
	85,400			85,400

Pammy’s Executor Account
Dr.				Cr.
Date	Particulars	J.F.	Amount ₹		Date	Particulars	J.F.	Amount ₹
2017-18					2017-18
Sep. 30	Bank		15,400		Sep. 30	Pammy’s Capital A/c		75,400
Mar. 31	Balance c/d		63,600		Mar. 31	Interest		3,600
			79,000					79,000

2018-19					2018-19
Sep. 30	Bank		22,200		April 01	Balance b/d		63,600
	(15,000+3,600+3,600)				Sep. 30	Interest		3,600
Mar. 31	Balance c/d		47,700		Mar. 31	Interest		2,700
			69,900					69,900

2019-20					2019-20
Sep. 30	Bank		20,400		April 01	Balance b/d		47,700
Mar. 31	Balance c/d		31,800		Sep. 30	Interest		2,700
					Mar. 31	Interest		1,800
			52,200					52,200

2020-21					2020-21
Sep. 30	Bank		18,600		April 01	Balance b/d		31,800
	(15,000+1,800+1,800)				Sep. 30	Interest		1,800
Mar. 31	Balance c/d		15,900		Mar. 31	Interest		900
			34,500					34,500

2021-22					2021-22
Sep. 30	Bank		16,800		April 01	Balance b/d		15,900
	(15,000+900+900)				Sep. 30	Interest		900
			16,800					16,800

Working Notes:

1) Pammy’s Share of Profit

Previous Year’s Profit × Proportionate Period × Share of Deceased Partner

2) Pammy’s Share of Goodwill

Goodwill of the firm = Average Profit × Numbers of Year’s Purchase

Average Profit

Goodwill of the Firm = 50,000 ´ 3 = ₹ 1,50,000

3) Gaining Ratio = New Ratio – Old Ratio

Puneet’s Share

Pankaj’s Share

Gaining Ratio between Puneet and Pankaj = 2:2 or 1:1

4) Interest on Capital for 6 months, i.e. from April 1, 2007, to September 30, 2007

Amount of Capital × Rate of Interest × Period

5) Interest Amount

The firm closes its books every year on March 31, while instalments to Pammy’s Executor are paid on September 30 every year.

Amount outstanding on 30 September = 75,400 – 15,400 = ₹ 60,000

Chp 4-23

Q9Written answer

Following is the Balance Sheet of Prateek, Rockey and Kushal as on March 31, 2017.

Books of Prateek, Rockey and Kushal
Balance Sheet as on March 31, 2017
Liabilities		Amount ₹	Assets	Amount ₹
Sundry Creditors		16,000	Bills Receivable	16,000
General Reserve		16,000	Furniture	22,600
Capital Accounts:			Stock	20,400
Prateek	30,000		Sundry Debtors	22,000
Rockey	20,000		Cash at Bank	18,000
Kushal	20,000	70,000	Cash in Hand	3,000
		1,02,000		1,02,000

Rockey died on June 30, 2017. Under the terms of the partnership deed, the executors of a deceased partner were entitled to:

a) Amount standing to the credit of the Partner’s Capital account.

b) Interest on capital at 5% per annum.

c) Share of goodwill on the basis of twice the average of the past three years’ profit.

d) Share of profit from the closing date of the last financial year to the date of death on the basis of last year’s profit.

Profits for the year ending on March 31, 2015, March 31, 2016, and March 31, 2017, were ₹ 12,000, ₹ 16,000 and ₹ 14,000, respectively. Profits were shared in the ratio of capital.

Pass the necessary journal entries and draw up Rockey’s capital account to be rendered to his executor.

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Books of Prateek and Kushal Journal
Date	Particulars		L.F.	Amount ₹	Amount ₹
2017
June 30	Interest on Capital A/c	Dr.		250
	Profit and Loss (Suspense) A/c	Dr.		1,000
	General Reserve A/c	Dr.		4,571
	To Rockey’s Capital A/c				5,821
	(Share of profit, interest on capital and share of General Reserve credited to Rockey’s Capital Account)

June 30	Prateek’s Capital A/c	Dr.		4,800
	Kushal’s Capital A/c	Dr.		3,200
	To Rockey’s Capital A/c				8,000
	(Rockey’s share of goodwill adjusted to Prateek’s and Kushal’s Capital Account in their gaining ratio, 3:2)

June 30	Rockey’s Capital A/c	Dr.		33,821
	To Rockey Executor’s A/c				33,821
	(Balance of Rockey’s Capital Account transferred to his Executor’s Account)

Rockey’s Capital Account
Dr.					Cr.
Date	Particulars	J.F.	Amount ₹	Date		Particulars	J.F.	Amount ₹
2017				2017
April 1	Rockey’s Executor A/c		33,821	April 1		Balance b/d		20,000
						Interest on Capital		250
						Profit and Loss (Suspense) A/c		1,000
						General Reserve		4,571
						Prateek’s Capital		4,800
						Kushal’s Capital		3,200
			33,821					33,821

Working Notes:

1. Rockey’s Share of Profit = Previous Year’s Profit × Proportionate Period × Share of Deceased Partner

=
Chp 4-24

2. Rockey’s Share of Goodwill

Goodwill of a firm = Average profit × Numbers of Year’s Purchase

Chp 4-25

Goodwill of a firm = 14,000 × 2 = ₹ 28,000

Chp 4-26

3. Gaining Ratio = New Ratio − Old Ratio

Chp 4-27

Chp 4-28

Gaining Ratio between Prateek and Kushal = 9:4 or 3:2

4. Interest on Capital for 3 months, i.e. from April 1, 2017, to June 30, 2017

Amount of × Rate of Interest × Period
Chp 4-29

Q10Written answer

Narang, Suri and Bajaj are partners in a firm, sharing profits and losses in the proportion of 1/2, 1/6 and 1/3, respectively. The Balance Sheet on April 1, 2015, was as follows:

Books of Suri, Narang and Bajaj Balance Sheet as on April 1, 2015
Liabilities		Amount ₹	Assets		Amount ₹
Bills Payable		12,000	Freehold Premises		40,000
Sundry Creditors		18,000	Machinery		30,000
Reserves		12,000	Furniture		12,000
Capital Accounts:			Stock		22,000
Narang	30,000		Sundry Debtors	20,000
Suri	20,000		Less: Reserve	1,000	19,000
Bajaj	28,000	88,000	for Bad Debt
			Cash		7,000
		1,30,000			1,30,000

Bajaj retires from the business, and the partners agree to the following:

a) Freehold premises and stock are to be appreciated by 20% and 15%, respectively.

b) Machinery and furniture are to be depreciated by 10% and 7%, respectively.

c) Bad Debts reserve is to be increased to ₹ 1,500.

d) Goodwill is valued at ₹ 21,000 on Bajaj’s retirement.

e) The continuing partners have decided to adjust their capital in their new profit-sharing ratio after the retirement of Bajaj. Surplus/deficit, if any, in their capital accounts will be adjusted through current accounts.

Prepare necessary ledger accounts and draw the Balance Sheet of the reconstituted firm.

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Revaluation Account
Dr.			Cr.
Particulars		Amount ₹		Particulars	Amount ₹
Machinery		3,000		Freehold Properties	8,000
Furniture		840		Stock	3,300
Reserve for Bad debts		500
Capitals:
Narang	3,480
Suri	1,160
Bajaj	2,320	6,960
		11,300			11,300

Partners’ Capital Account
Dr.					Cr.
Particulars	Narang	Suri	Bajaj	Particulars		Narang	Suri	Bajaj
Bajaj’s Capital A/c	5,250	1,750		Balance b/d		30,000	30,000	28,000
Bajaj’s Loan			41,320	Reserves		6,000	2,000	4,000
				Revaluation (Profit)		3,480	1,160	2,320
Balance c/d	34,230	31,410		Narang’s Capital A/c				5,250
				Suri’s Capital A/c				1,750
	39,480	33,160	41,320			39,480	33,160	41,320

Suri’s Current A/c		15,000		Balance b/d		34,230	31,410
				Narang’s Current A/c		15,000
Balance c/d	49,230	16,410
	49,230	31,410				49,230	31,410

Balance Sheet as on April 01, 2015
Liabilities		Amount ₹	Assets		Amount ₹
Bills Payable		12,000	Freehold Premises		48,000
Sundry Creditors		18,000	Machinery		27,000
Bajaj’s Loan		41,320	Furniture		11,160
Suri’s Current		15,000	Stock		25,300
Capital Account:			Sundry Debtors	20,000
Narang	49,230		Less: Reserve for Bad Debt	1,500	18,500
Suri	16,410	65,640	Cash		7,000
			Narang’s Current Account		15,000
		1,51,960			1,51,960

Working Notes:

1. Bajaj Share in Goodwill = Total Goodwill of the firm x Retiring partner’s share =

2. Gaining Ratio = New Ratio – Old Ratio

Gaining Ratio between Narang and Suri = 3:1

3. Calculation of New Capitals of the existing partners.

Balance in Narang’s Capital	=	34,230
Balance in Suri’s Capital	=	31,410
Total Capital of the New firm after revaluation of assets and
liabilities and adjustment of Goodwill and Reserves	=	₹ 65,640

Based on the new profit-sharing ratio of 3:1

NOTE:

i. In the given question, Suri’s Capital is ₹ 30,000 instead of ₹ 20,000.

ii. Due to an insufficient balance in Bajaj’s Capital Account, the amount due to Bajaj is transferred to his Loan Account.

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Unit 3: Reconstitution of a Partnership Firm – Retirement/Death of a Partner

Numerical Questions for NCERT Accountancy Solutions Class 12 Part 1 Chapter 4