Importance of Education

12th Date Sheet 2025

10th Date Sheet 2025

MBA Entrance Exams

Medical Entrance Exams

Exams in India

Entrance Exams in India

How To Prepare for Exams

Career Options

After 12th Courses

Universities in India

Class 12 Accountancy Answer Key | CBSE Exam 2025-26 Board Term 1

1. Arora and Gurmeet were partners in a firm sharing profits and losses in the ratio of 3:2. Starting from 1st October, 2024 Arora withdrew ₹ 30,000 at the beginning of each quarter for his personal use. Interest on drawings was to be charged @ 12% per annum. Interest on Arora’s drawings for the year ended 31st March, 2025 was:

(A) ₹ 1,800
(B) ₹ 2,700
(C) ₹ 450
(D) ₹ 3,600

Answer is as follow: (B) ₹ 2,700

2. There are two statements Assertion (A) and Reason (R):

Assertion (A): At the time of admission of a new partner in a partnership firm, the newly admitted partner brings an agreed amount of capital either in cash or in kind.

Reason (R): On admission, the new partner gets the right to acquire share in the assets and profits of the partnership firm.

Choose the correct option from the following:

(A) Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).
(B) Both Assertion (A) and Reason (R) are correct, but Reason (R) is not the correct explanation of Assertion (A).
(C) Assertion (A) is correct, but Reason (R) is incorrect.
(D) Assertion (A) is incorrect, but Reason (R) is correct.

Answer is as follow: (A)

3(a). Merak Ltd. forfeited 6,000 equity shares of ₹ 10 each for non-payment of final call of ₹ 3 per share. The minimum amount per share at which these shares can be reissued will be:

(A) ₹ 3
(B) ₹ 7
(C) ₹ 10
(D) ₹ 6

Answer is as follow: (B) ₹ 7

3(b). Nori Ltd. issued 20,000, 11% debentures of ₹ 100 each at a premium of 10%, redeemable at a premium of 5%. Loss on issue of debentures account will be debited by:

(A) ₹ 20,00,000
(B) ₹ 1,00,000
(C) ₹ 3,00,000
(D) ₹ 2,00,000

Answer is as follow: (B) ₹ 1,00,000

4(a). Guru and Prakash were partners in a firm sharing profits and losses in the ratio of 7:3. They admitted Anu as a new partner for 1/4 share in the profits of the firm. On the date of Anu's admission, the Profit and Loss Account of Guru and Prakash showed a credit balance of ₹ 40,000. The necessary journal entry for its treatment will be:

(A) Profit and Loss A/c Dr. 40,000 To Guru’s Capital A/c 21,000 To Prakash’s Capital A/c 9,000 To Anu’s Capital A/c 10,000
(B) Profit and Loss A/c Dr. 40,000 To Guru’s Capital A/c 28,000 To Prakash’s Capital A/c 12,000
(C) Guru’s Capital A/c Dr. 21,000 Prakash’s Capital A/c Dr. 9,000 Anu’s Capital A/c Dr. 10,000 To Profit and Loss A/c 40,000
(D) Guru’s Capital A/c Dr. 28,000 Prakash’s Capital A/c Dr. 12,000 To Profit and Loss A/c 40,000

Answer is as follow: (B)

4(b). Samta, Mamta and Geeta were partners in a firm sharing profits and losses in the ratio of 11:5:4. On 31st March, 2025 Samta died. On Samta’s death, the goodwill of the firm was valued at ₹ 1,80,000. The necessary journal entry for the treatment of goodwill on Samta’s death will be:

(A) Samta’s Capital A/c Dr. 99,000 To Mamta’s Capital A/c 55,000 To Geeta’s Capital A/c 44,000
(B) Mamta’s Capital A/c Dr. 1,00,000 Geeta’s Capital A/c Dr. 80,000 To Samta’s Capital A/c 1,80,000
(C) Samta’s Capital A/c Dr. 1,80,000 To Mamta’s Capital A/c 1,00,000 To Geeta’s Capital A/c 80,000
(D) Mamta’s Capital A/c Dr. 55,000 Geeta’s Capital A/c Dr. 44,000 To Samta’s Capital A/c 99,000

Answer is as follow: (B)

5. Mansi and Uma were partners in a firm and their capitals were ₹ 4,00,000 and ₹ 2,00,000 respectively. Normal rate of return in a similar business was 15% and the goodwill of the firm was valued at ₹ 4,00,000. If goodwill was calculated at four years’ purchase of super profits, the average profits of the firm were:

(A) ₹ 90,000
(B) ₹ 60,000
(C) ₹ 1,00,000
(D) ₹ 1,90,000

Answer is as follow: (D) ₹ 1,90,000

6(a). Reserve capital is that portion of the _______ capital that can be called only in the event of winding up of the company.

(A) called-up
(B) uncalled
(C) paid-up
(D) subscribed

Answer is as follow: (B) uncalled

6(b). The debentures which do not carry a specific rate of interest are known as:

(A) Irredeemable debentures
(B) Bearer debentures
(C) Specific coupon rate debentures
(D) Zero coupon rate debentures

Answer is as follow: (D) Zero coupon rate debentures

7(a). John, Honey and Jacob were partners in a firm sharing profits and losses equally. On 31st July, 2025 John died. His share in the profits of the firm from the date of last balance sheet till the date of his death will be:

(A) Debited to Profit and Loss Account
(B) Credited to Profit and Loss Account
(C) Debited to Profit and Loss Suspense Account
(D) Credited to Profit and Loss Suspense Account

Answer is as follow: (C) Debited to Profit and Loss Suspense Account

7(b). Shashi, Maya and Komal were partners in a firm sharing profits and losses in the ratio of 5:3:2. On 31st March, 2025 Komal retired. The new profit sharing ratio between Shashi and Maya was decided as 3:5. The gain or sacrifice of Shashi and Maya on Komal’s retirement was:

(A) Shashi’s sacrifice 1/8 ; Maya’s gain 13/40
(B) Shashi’s gain 1/8 ; Maya’s sacrifice 13/40
(C) Shashi’s sacrifice 1/8 ; Maya’s sacrifice 13/40
(D) Shashi’s gain 1/8 ; Maya’s gain 13/40

Answer is as follow: (A)

8. Alok, Sarah and Aditya were partners in a firm sharing profits and losses in the ratio of 5:3:2. On 1st January, 2025 Alok advanced a loan of ₹ 2,00,000 to the firm. In the absence of a partnership agreement, the amount of interest on loan due to Alok on 31st March, 2025 will be:

(A) ₹ 20,000
(B) ₹ 12,000
(C) ₹ 3,000
(D) ₹ 5,000

Answer is as follow: (C) ₹ 3,000

9(a). Sudama, Sharma and Varun were partners in a firm sharing profits and losses in the ratio of 6:4:3. Sharma retired from the firm on 31st March, 2025. The gaining ratio of Sudama and Varun will be:

(A) 3:2
(B) 2:1
(C) 1:2
(D) 2:3

Answer is as follow: (A) 3:2

9(b). Hari, Murari and Abhi were partners in a firm sharing profits and losses in the ratio of 8:7:4. Murari retired from the firm on 31st March, 2025. Hari and Abhi decided to share profits in the future in the ratio of 2:1. The gaining ratio of Hari and Abhi was:

(A) 1:2
(B) 8:7
(C) 2:1
(D) 7:4

Answer is as follow: (C) 2:1

10. Munna and Sonu were partners in a firm sharing profits and losses in the ratio of 4:1. Their fixed capitals were ₹ 40,00,000 and ₹ 30,00,000 respectively. During the year ended 31st March, 2025, Munna withdrew ₹ 50,000 for personal use. Interest on drawings was to be charged @ 6% p.a. The journal entry for charging interest on Munna’s drawings will be:

(A) Interest on Drawings A/c Dr. 1,500 To Munna’s Capital A/c 1,500
(B) Munna’s Capital A/c Dr. 1,500 To Interest on Drawings A/c 1,500
(C) Interest on Drawings A/c Dr. 1,500 To Munna’s Current A/c 1,500
(D) Munna’s Current A/c Dr. 1,500 To Interest on Drawings A/c 1,500

Answer is as follow: (D)

11. Sujata and Laxmi were partners in a firm sharing profits and losses in the ratio of 2:1. On 1st April, 2025, they admitted Raghu as a new partner for 1/5 share in the profits of the firm. On the date of Raghu’s admission, it was found that the equipment is undervalued by ₹ 90,000. After revaluation, the Balance Sheet of Sujata, Laxmi and Raghu showed equipment at ₹ 3,00,000. The value of equipment shown in the books of the firm of Sujata and Laxmi before Raghu’s admission was:

(A) ₹ 3,90,000
(B) ₹ 2,10,000
(C) ₹ 3,00,000
(D) ₹ 90,000

Answer is as follow: (B) ₹ 2,10,000

12. On 1st April, 2024, DD Ltd. issued 2,000, 9% debentures of ₹ 50 each at a premium of 5%, redeemable at a premium of ₹ 10 per debenture after five years. Interest on the debentures was to be paid on half-yearly basis on 30th September and 31st March. Interest on the debentures for the year ended 31st March, 2025 will be:

(A) ₹ 4,500
(B) ₹ 9,000
(C) ₹ 9,450
(D) ₹ 4,725

Answer is as follow: (B) ₹ 9,000

13. Universal Ltd. took over machinery of ₹ 3,30,000, furniture of ₹ 1,60,000 and liabilities of ₹ 80,000 from Amol Ltd. for a purchase consideration of ₹ 4,50,000. The payment to Amol Ltd. was made by issue of 10% debentures of ₹ 50 each at a discount of 10%. The number of debentures issued to Amol Ltd. was:

(A) 1,000
(B) 4,500
(C) 45,000
(D) 10,000

Answer is as follow: (D) 10,000

14. At the time of forfeiture of shares, ‘Share Capital Account’ is debited with:

(A) Paid-up amount on forfeited shares
(B) Called-up amount on forfeited shares
(C) Face value of shares forfeited
(D) Unpaid amount on forfeited shares

Answer is as follow: (B) Called-up amount on forfeited shares

15. Sushil and Sapna were partners in a firm sharing profits and losses in the ratio of 3:2. On 31st March, 2025, the firm was dissolved. On the date of dissolution there existed a balance of ₹ 1,20,000 in sundry creditors account. The sundry creditors were payable after three months. They were paid immediately at a discount of 12% p.a. The amount paid to sundry creditors was:

(A) ₹ 1,20,000
(B) ₹ 1,23,600
(C) ₹ 1,16,400
(D) ₹ 1,34,400

Answer is as follow: (C) ₹ 1,16,400

16. Raha, Naveen and Vandana were partners in a firm sharing profits and losses equally. Naveen retired on 31st March, 2025. The balance in his capital account after making the necessary adjustments on account of reserves and revaluation of assets and reassessment of liabilities was ₹ 1,27,000. Naveen was paid ₹ 1,50,000 in full settlement of his claim. The value of goodwill of the firm on the date of Naveen’s retirement was:

(A) ₹ 1,50,000
(B) ₹ 23,000
(C) ₹ 69,000
(D) ₹ 4,50,000

Answer is as follow: (C) ₹ 69,000

17. Namita, Narendra and Kunwar were partners in a firm sharing profits and losses in the ratio of 3:1:1. The firm closes its books on 31st March every year. Kunwar died on 30th September, 2025. His share in the profits of the firm from 1st April, 2025 to 30th September, 2025 was calculated as per the provisions of the partnership deed which amounted to ₹ 15,600. On the date of Kunwar’s death, the Balance Sheet of the firm showed General Reserve of ₹ 40,000 and Profit and Loss Account (Dr.) ₹ 80,000. Pass necessary journal entries on Kunwar’s death in the books of the firm.

Entry (Distribution of accumulated loss):

Namita’s Capital A/c Dr. ₹ 48,000
Narendra’s Capital A/c Dr. ₹ 16,000
Kunwar’s Capital A/c Dr. ₹ 16,000
To Profit and Loss A/c ₹ 80,000

Quick Tip: Death of partner checklist: Profit till death → P&L Suspense A/c. Reserves → credit in old ratio. Accumulated losses → debit in old ratio.

18. Naik, Vinay and Vibhuti were partners in a firm sharing profits and losses in the ratio of 4:2:3. On 31st March, 2025, Naik retired. General Reserve = ₹ 45,000. Revaluation resulted in a loss of ₹ 18,000. Goodwill of the firm was valued at ₹ 1,80,000 and adjusted without opening goodwill account. Amount payable to Naik was transferred to his loan account. Pass necessary journal entries.

1. Distribution of General Reserve:

General Reserve A/c Dr. ₹ 45,000
To Naik’s Capital A/c ₹ 20,000
To Vinay’s Capital A/c ₹ 10,000
To Vibhuti’s Capital A/c ₹ 15,000

2. Revaluation Loss:

Naik’s Capital A/c Dr. ₹ 8,000
Vinay’s Capital A/c Dr. ₹ 4,000
Vibhuti’s Capital A/c Dr. ₹ 6,000
To Revaluation A/c ₹ 18,000

3. Goodwill Adjustment (without opening Goodwill A/c):

Vinay’s Capital A/c Dr. ₹ 32,000
Vibhuti’s Capital A/c Dr. ₹ 48,000
To Naik’s Capital A/c ₹ 80,000

4. Transfer of Naik’s Capital Balance to Loan A/c:

Naik’s Capital A/c Dr. (Balancing Figure)
To Naik’s Loan A/c

Quick Tip: Retirement entries order: Reserves → old ratio; Revaluation → old ratio; Goodwill → gaining ratio; Final balance → Loan A/c.

19(a). Kiara Ltd. purchased assets worth ₹ 12,40,000 and took over liabilities of ₹ 3,40,000 of Amrit Ltd. for a purchase consideration of ₹ 11,00,000. Kiara Ltd. paid half the amount by cheque. The balance was settled by issuing 9% debentures of ₹ 100 each at a premium of 10%. Pass necessary journal entries in the books of Kiara Ltd.

Step 1: Purchase Consideration

Given = ₹ 11,00,000

Half paid in cash = ₹ 5,50,000

Balance by debentures = ₹ 5,50,000

Step 2: Issue price of debentures

Face value = ₹ 100
Issued at 10% premium → Issue price = ₹ 110
Number of debentures = 5,50,000 ÷ 110 = 5,000

Journal Entries:

1. For purchase of business:

Business Purchase A/c Dr. ₹ 11,00,000
To Liquidator of Amrit Ltd. ₹ 11,00,000

2. For assets taken over:

Various Assets A/c Dr. ₹ 12,40,000
To Liabilities A/c ₹ 3,40,000
To Business Purchase A/c ₹ 11,00,000

3. Payment by cheque:

Liquidator of Amrit Ltd. Dr. ₹ 5,50,000
To Bank A/c ₹ 5,50,000

4. Issue of debentures at premium:

Liquidator of Amrit Ltd. Dr. ₹ 5,50,000
To 9% Debentures A/c ₹ 5,00,000
To Securities Premium A/c ₹ 50,000

Quick Tip: When business is purchased: Debit Business Purchase A/c, record assets and liabilities separately, and issue debentures at premium/discount accordingly.

19(b). On 1st April, 2024, Zara Ltd. issued 8,000, 9% debentures of ₹ 100 each at a discount of 10%. The company had a balance of ₹ 50,000 in Securities Premium Account on the same date. Pass necessary journal entries for the issue of debentures and to write off discount on issue of debentures.

Step 1: Calculate Discount

Face value = 8,000 × 100 = ₹ 8,00,000

Discount = 10% → ₹ 80,000

Journal Entries:

1. Issue of debentures at discount:

Bank A/c Dr. ₹ 7,20,000
Discount on Issue of Debentures A/c Dr. ₹ 80,000
To 9% Debentures A/c ₹ 8,00,000

2. Writing off discount using Securities Premium:

Securities Premium A/c Dr. ₹ 50,000
To Discount on Issue of Debentures A/c ₹ 50,000

Remaining discount (₹ 30,000) will be written off over time.

Quick Tip: Discount on debentures is recorded as a loss. It can be written off using Securities Premium as per Companies Act.

20. Nandini, Shweta and Hiren were partners in a firm sharing profits and losses in the ratio of 9:7:4. On 1st April, 2025, Shweta retired. On the date of Shweta’s retirement, there existed a balance of ₹ 1,00,000 in Workmen’s Compensation Fund. Pass necessary journal entries for treatment of Workmen’s Compensation Fund on Shweta’s retirement in each of the following cases:

Old ratio = 9:7:4 (Total = 20)

(i) Claim = ₹ 1,20,000 (More than fund)

Fund available = ₹ 1,00,000
Deficiency = ₹ 20,000

Loss shared in old ratio:

Nandini = 20,000 × 9/20 = 9,000
Shweta = 20,000 × 7/20 = 7,000
Hiren = 20,000 × 4/20 = 4,000

Entry:

Workmen’s Compensation Fund A/c Dr. ₹ 1,00,000
Revaluation A/c Dr. ₹ 20,000
To Workmen’s Compensation Liability A/c ₹ 1,20,000

Nandini’s Capital A/c Dr. ₹ 9,000
Shweta’s Capital A/c Dr. ₹ 7,000
Hiren’s Capital A/c Dr. ₹ 4,000
To Revaluation A/c ₹ 20,000

(ii) Claim = ₹ 80,000 (Less than fund)

Surplus = ₹ 20,000
Distributed in old ratio:

Nandini = 9,000
Shweta = 7,000
Hiren = 4,000

Entry:

Workmen’s Compensation Fund A/c Dr. ₹ 1,00,000
To Workmen’s Compensation Liability A/c ₹ 80,000
To Revaluation A/c ₹ 20,000

Revaluation A/c Dr. ₹ 20,000
To Nandini’s Capital A/c ₹ 9,000
To Shweta’s Capital A/c ₹ 7,000
To Hiren’s Capital A/c ₹ 4,000

(iii) Claim = ₹ 1,00,000 (Equal to fund)

No profit or loss.

Entry:

Workmen’s Compensation Fund A/c Dr. ₹ 1,00,000
To Workmen’s Compensation Liability A/c ₹ 1,00,000

Quick Tip: Workmen’s Compensation Fund: Claim > Fund → deficiency = loss (old ratio), Claim < Fund → surplus = gain (old ratio), Claim = Fund → no adjustment.

21. Pass necessary journal entries for the issue of debentures for the following transactions:

(i) XS Ltd. issued 40,000, 9% debentures of ₹ 100 each at a premium of 10%, redeemable at a premium of 5%.

Step 1: Face value = 40,000 × 100 = ₹ 40,00,000

Premium on issue = 10% = ₹ 4,00,000

Premium on redemption = 5% = ₹ 2,00,000

Journal Entry:

Bank A/c Dr. ₹ 44,00,000
Loss on Issue of Debentures A/c Dr. ₹ 2,00,000
To 9% Debentures A/c ₹ 40,00,000
To Securities Premium A/c ₹ 4,00,000

Note: Loss arises due to premium payable on redemption.

(ii) YG Ltd. issued 50,000, 9% debentures of ₹ 100 each at par, redeemable at a premium of 10%.

Step 1: Face value = 50,000 × 100 = ₹ 50,00,000

Issued at par → No premium or discount on issue.

Premium on redemption = 10% = ₹ 5,00,000

Journal Entry:

Bank A/c Dr. ₹ 50,00,000
Loss on Issue of Debentures A/c Dr. ₹ 5,00,000
To 9% Debentures A/c ₹ 50,00,000
To Premium on Redemption of Debentures A/c ₹ 5,00,000

Quick Tip: Debenture issue rules: Premium on issue → Securities Premium A/c, Premium on redemption → Loss on Issue. Loss = Discount + Premium on redemption.

22(a). Jain and Gupta were partners in a firm sharing profits and losses in the ratio of 3:1. On 1st April, 2024, Agarwal was admitted as a new partner for 1/5 share in the profits of the firm with a minimum guaranteed amount of ₹ 75,000. Any deficiency arising out of this guarantee was to be borne by Jain and Gupta in the ratio of 1:3. During the year ended 31st March, 2025, the firm earned a net profit of ₹ 3,00,000. Prepare Profit and Loss Appropriation Account.

Step 1: New profit sharing ratio

Agarwal’s share = 1/5
Remaining = 4/5 shared by Jain and Gupta in 3:1 → Jain = 3/5, Gupta = 1/5
New ratio = 3:1:1 (Jain : Gupta : Agarwal)

Step 2: Calculate profit shares

Total profit = ₹ 3,00,000
Jain = 3/5 × 3,00,000 = ₹ 1,80,000
Gupta = 1/5 × 3,00,000 = ₹ 60,000
Agarwal = 1/5 × 3,00,000 = ₹ 60,000

Step 3: Guarantee adjustment

Guaranteed = ₹ 75,000, Actual = ₹ 60,000, Deficiency = ₹ 15,000

Borne by Jain and Gupta in 1:3 ratio:

Jain = 15,000 × 1/4 = 3,750
Gupta = 15,000 × 3/4 = 11,250

Final profit distribution:

Jain = 1,80,000 − 3,750 = ₹ 1,76,250
Gupta = 60,000 − 11,250 = ₹ 48,750
Agarwal = 75,000

Profit and Loss Appropriation Account:

To Jain’s Capital A/c ₹ 1,76,250
To Gupta’s Capital A/c ₹ 48,750
To Agarwal’s Capital A/c ₹ 75,000
By Profit and Loss A/c ₹ 3,00,000

Quick Tip: Guarantee problems: Calculate actual share first, compare with guaranteed amount, deficiency borne by guarantors in agreed ratio.

22(b). Annu, Bandhu, Sheelu and Golu were partners in a firm sharing profits in the ratio of 4:3:2:1. On 1st April, 2025, they decided to share future profits equally. Goodwill of the firm was valued at ₹ 4,00,000. Calculate gain or sacrifice and pass single adjustment entry.

Step 1: Old and New Ratios

Old Ratio (Annu : Bandhu : Sheelu : Golu) = 4:3:2:1
Total = 10 parts
New Ratio (equal) = 1:1:1:1 = 4 parts total (each partner 1/4 share)

Step 2: Gain or Sacrifice

Goodwill = ₹ 4,00,000

Sheelu and Golu sacrifice = 20,000 and 60,000 respectively (their shares reduced)

Annu and Bandhu gain = 60,000 and 20,000 respectively (their shares increased)

Step 3: Single Adjustment Entry:

Sheelu’s Capital A/c Dr. ₹ 20,000
Golu’s Capital A/c Dr. ₹ 60,000
To Annu’s Capital A/c ₹ 60,000
To Bandhu’s Capital A/c ₹ 20,000

Quick Tip: Gain or sacrifice due to change in profit sharing ratio is adjusted through partners’ capital accounts via a single journal entry. Sacrificing partners pay, gaining partners receive.

23. Diwan Ltd. was registered with an authorised capital of ₹ 1,00,00,000 divided into 1,00,000 equity shares of ₹ 100 each. The company invited applications for issuing 50,000 shares. The amount was payable as follows:

On Application and Allotment – ₹ 30 per share
On First Call – ₹ 40 per share
On Second and Final Call – Balance

The issue was fully subscribed. All amounts were received except from Nawal, a shareholder holding 700 shares, who failed to pay the second and final call. His shares were forfeited.

(i) The Registered capital of Diwan Ltd. is:

(A) ₹ 1,00,00,000
(B) ₹ 1,00,000
(C) ₹ 50,00,000
(D) ₹ 50,000

Answer: Registered capital = Authorised capital = ₹ 1,00,00,000 → (A)

(ii) The Issued capital of Diwan Ltd. is:

(A) ₹ 1,00,00,000
(B) ₹ 1,00,000
(C) ₹ 50,00,000
(D) ₹ 50,000

Answer: Issued shares = 50,000 × ₹ 100 = ₹ 50,00,000 → (C)

(iii) Calls in arrears of the company amounted to:

(A) ₹ 21,000
(B) ₹ 70,000
(C) Nil
(D) ₹ 49,000

Answer: Second and final call = ₹ 30 per share × 700 shares = ₹ 21,000 → (A)

(iv) Share Forfeiture Account will appear in Notes to Accounts at:

(A) ₹ 21,000
(B) ₹ 70,000
(C) Nil
(D) ₹ 49,000

Answer: Amount received before forfeiture = Application + First call = ₹ 70 per share × 700 shares = ₹ 49,000 → (D)

(v) The amount of Share Capital presented in Balance Sheet will be:

(A) ₹ 49,30,000
(B) ₹ 50,00,000
(C) ₹ 49,79,000
(D) ₹ 49,49,000

Answer: Issued capital = ₹ 50,00,000 − forfeited shares (700 × 100 = 70,000) = ₹ 49,30,000 → (A)

24. Admission of Suraj into Asha and Indra’s Partnership Firm

Given: Profit sharing ratio of Asha:Indra = 3:2, Suraj admitted for 1/4 share in profits.

Step 1: Calculation of Suraj’s Capital (proportionate to share)

Total Capitals of Asha and Indra = ₹ 4,00,000 + ₹ 3,00,000 = ₹ 7,00,000

Suraj’s share in profits = 1/4 → proportionate capital = 1/4 × (7,00,000) / (1 - 1/4) = 7,00,000 × 1/3 = ₹ 2,33,333 (approx)

Goodwill = ₹ 1,00,000, Suraj brings 1/4 = ₹ 25,000 in cash.

Total cash brought by Suraj = Capital + Goodwill share = 2,33,333 + 25,000 = ₹ 2,58,333

Step 2: Revaluation of Assets and Liabilities

Adjustments:

Furniture taken over by Asha at ₹ 1,00,000 → Loss = 1,20,000 − 1,00,000 = ₹ 20,000
Plant & Machinery revalued at ₹ 4,35,000 → Gain = 4,35,000 − 4,05,000 = ₹ 30,000
Creditors ₹ 5,000 will not arise → Gain = ₹ 5,000

Net revaluation profit = 35,000 − 20,000 = ₹ 15,000

Shared in old ratio 3:2 → Asha = 9,000, Indra = 6,000

Step 3: Partners’ Capital Accounts (after adjustments)

Asha:

Opening Capital: ₹ 4,00,000
Add: Revaluation Profit: ₹ 9,000
Less: Furniture taken: ₹ 20,000
Balance: ₹ 3,89,000

Indra:

Opening Capital: ₹ 3,00,000
Add: Revaluation Profit: ₹ 6,000
Balance: ₹ 3,06,000

Suraj:

Capital brought: ₹ 2,33,333
Goodwill brought: ₹ 25,000
Balance: ₹ 2,58,333

Quick Notes:

Revaluation profit/loss shared in old ratio (3:2).
Furniture adjustment reduces Asha’s capital.
Suraj brings proportionate capital plus goodwill in cash.
New capitals: Asha = ₹ 3,89,000, Indra = ₹ 3,06,000, Suraj = ₹ 2,58,333

Quick Notes:

Revaluation profit/loss shared in old ratio (3:2).
Furniture adjustment reduces Asha’s capital.
Suraj brings proportionate capital plus goodwill in cash.
New capitals: Asha = ₹ 3,89,000, Indra = ₹ 3,06,000, Suraj = ₹ 2,58,333

Question 25(a) – Ajanta Ltd. Share Issue

Bank A/C Dr ₹6,00,000
To Share Application A/C ₹6,00,000 (Being application money received for 50,000 shares @ ₹12 each)
Share Application A/C Dr ₹6,00,000
To Share Capital A/C ₹3,00,000
To Securities Premium A/C ₹1,50,000
To Bank A/C ₹1,50,000 (Being 30,000 shares allotted, excess application money adjusted towards calls, 10,000 shares refunded)
Bank A/C Dr ₹2,00,000
To Share First & Final Call A/C ₹2,00,000 (Being first & final call received including adjustment of excess application money)
Share First & Final Call A/C Dr ₹900
To Share Capital A/C ₹900 (Being 300 shares of Vedika forfeited for non-payment)
Forfeited Shares A/C Dr ₹900
To Share Capital A/C ₹900 (Being Vedika’s forfeited shares transferred to forfeited account)

Question 25(b) – Forfeiture & Reissue of Shares

Bank A/C Dr ₹0
Forfeited Shares A/C Dr ₹750
To Share Capital A/C ₹750 (Rao Ltd. – 750 shares forfeited for non-payment of first call)
Bank A/C Dr ₹2,500
Forfeited Shares A/C Dr ₹750
To Share Capital A/C ₹3,250 (500 forfeited shares reissued @ ₹7 per share)
Bank A/C Dr ₹10,000
Forfeited Shares A/C Dr ₹5,000
To Share Capital A/C ₹15,000 (Lily Ltd. – 750 forfeited shares reissued to Ashok as fully paid-up)
Bank A/C Dr ₹6,750
Forfeited Shares A/C Dr ₹2,250
To Share Capital A/C ₹9,000 (Remaining 1,250 shares reissued to Sudha @ ₹9 per share)

Question 26(a) – Change in Profit Sharing & Revaluation

Land & Building A/C Dr ₹X
To Revaluation A/C ₹X (Being land & building revalued)
Revaluation A/C Dr ₹X
To Provision for Doubtful Debts A/C ₹X
To Stock A/C ₹X (Being provision and stock adjustment made)
Revaluation A/C Dr / Cr ₹X
To Partners’ Capital A/Cs – Pronnil, Kamlesh, Ritika ₹X (in old ratio 5:3:2) (Being revaluation profit/loss transferred to old capitals)
Partners’ Capital A/Cs Dr ₹1,80,000
To Goodwill A/C ₹1,80,000 (Being goodwill brought in by partners in old ratio)

Question 26(b) – Realisation of Partnership Firm

Bank A/C Dr / Assets A/C Dr
To Realisation A/C (Being assets sold to third parties)
Realisation A/C Dr
To Bank A/C / Liabilities A/C (Being liabilities paid off)
Realisation A/C Dr
To Partners’ Capital A/Cs (Being profit/loss on realisation distributed to partners)
Bank A/C Dr
To Partners’ Capital A/Cs (Being cash transferred to partners on dissolution)

CBSE 10th Result 2021

CBSE 12th and 10th Syllabus and Model Papers

CBSE 10th Syllabus and Model paper

CBSE 12th Syllabus and Model paper

MBA Colleges in India

Last Updated on : March 26, 2026