Jag, Pravesh and Chander are partners in a firm sharing profits in the ratio of 5:3:2. respectively. Firm closes its accounts on 31st March every year. Jag dies on 30th September 2012. There was a balance of 47,000 in Jag's Capital Account in the beginning of the year. In the event of death of any partner, the Partnership Deed provides for the following:
(i) Interest on capital will be calculated at the rate of 12% p.a.
(ii) The deceased partner's representive will be paid Rs 16,000 for his share of goodwill.
(iii) His share of Reserve Fund which is Rs 50,000, shall be paid to his executor.
(iv) His shar of profit till the date of death will be calculated on the basis of sales. It is also specified that the sales during the year 2011-12 were Rs 10,00,000. The sales from 1st April, 2012 to 30th September, 2012 were Rs 2,00,000. The profit of the firm for the year ending 31st March, 2012 was Rs 1,00,000.
Prepare Jag's Capital Account to be presented to his representative.

Class 12 Accounts in Class 12 3 years ago

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Solution :
Notes: 1. JOG's SHARE of GOODWILL is contributed by Pravesh and CHANDER in the gaining ratio, i.e., `3:2.`
2. Jag's Share of Profit till the DATE of death:
(i) % of profit on sales `=("Profit")/("Sales")xx100=(Rs1,00,000)/(Rs10,00,00)xx10=10%.`
(ii) Profit on sale (1 st April, 2012 to 30th Septembe, 2012) `=Rs2,00,000xx10//100=Rs20,000.`
(iii) Jay's share of profit `=Rs20,000xx5//10=Rs10,000.`