Bank overdraft 4.200 47,456 46,883 190,883 Net assets Сapials Аpel Ere 88,714 62,491 39,678 190,883 Inie Total capital Additional information Inie decided to retire from the business on 31* December, 2020 and Pee is admitted as a partner on that date. The following matters are agreed: i. Apel and Ere are to share profits in the same ratio as before, and Pee is to have the same share of profits as Ere. ii. The following assets were revalued: Premises for GH¢120,000 Plant for GH¢35,000 Inventory for GH¢54,179 iii. Provision is to be made for doubtful debts in the sum of GH¢3,000. iv. Goodwill is to be recorded in the books on the day Inie retires in the sum of GH¢42,000. The partners in the new firm do not wish to maintain a goodwill account so that amount is to be written back against the new partners' capital accounts. Inie is to take his car at its book vahue of GH¢3,900 in part payment, and the balance of all he is owed by the firm in cash except GH¢20,000 which he is willing to leave as a loan V. account. The partners in the new firm are to start on an equal footing so far as capital accounts are concerned. Pee is to contribute cash of GH¢82,091. vii. The original partner in the old firm who has the higher investment will draw out cash so that his capital account balances equal those of his new partners. vi.
Bank overdraft 4.200 47,456 46,883 190,883 Net assets Сapials Аpel Ere 88,714 62,491 39,678 190,883 Inie Total capital Additional information Inie decided to retire from the business on 31* December, 2020 and Pee is admitted as a partner on that date. The following matters are agreed: i. Apel and Ere are to share profits in the same ratio as before, and Pee is to have the same share of profits as Ere. ii. The following assets were revalued: Premises for GH¢120,000 Plant for GH¢35,000 Inventory for GH¢54,179 iii. Provision is to be made for doubtful debts in the sum of GH¢3,000. iv. Goodwill is to be recorded in the books on the day Inie retires in the sum of GH¢42,000. The partners in the new firm do not wish to maintain a goodwill account so that amount is to be written back against the new partners' capital accounts. Inie is to take his car at its book vahue of GH¢3,900 in part payment, and the balance of all he is owed by the firm in cash except GH¢20,000 which he is willing to leave as a loan V. account. The partners in the new firm are to start on an equal footing so far as capital accounts are concerned. Pee is to contribute cash of GH¢82,091. vii. The original partner in the old firm who has the higher investment will draw out cash so that his capital account balances equal those of his new partners. vi.
Chapter15: Partnership Accounting
Section: Chapter Questions
Problem 1PA: The partnership of Tatum and Brook shares profits and losses in a 60:40 ratio respectively after...
Related questions
Question
Required: prepare
a. Revaluation account
b.
c. Retiring partner's (Inie) account
Transcribed Image Text:Apel, Ere and Inie are in partnership sharing profits and losses in the ratio 3:2:1 respectively. The
statement of financial position for the partnership as at December 31, 2020 is as follows:
Non-current assets
GH¢
90,000
GH¢
Premises
Plant
37,000
15,000
Vehicles
2.000
144,000
Fixtures
Current assets
Inventory
Accounts receivable
62,379
35,740
98.119
Current liabilities
Accounts payable
19,036
28,000
Loan - Inie
1
Transcribed Image Text:Bank overdraft
4.200
47,456
46,883
190,883
Net assets
Capitals
Apel
Ere
88,714
62,491
39,678
190,883
Inie
Total capital
Additional information
Inie decided to retire from the business on 31* December, 2020 and Pee is admitted as a partner
on that date. The following matters are agreed:
i Apel and Ere are to share profits in the same ratio as before, and Pee is to have the same share
of profits as Ere. ii. The following assets were revalued:
Premises for GH¢120,000
Plant for GH¢35,000
Inventory for GH¢54,179 ii. Provision is to be made for doubtful
debts in the sum of GH¢3,000.
iv.
Goodwill is to be recorded in the books on the day Inie retires in the sum of GH¢42,000.
The partners in the new firm do not wish to maintain a goodwill account so that amount
is to be written back against the new partners' capital accounts.
Inie is to take his car at its book value of GH¢3,900 in part payment, and the balance of
all he is owed by the firm in cash except GH¢20,000 which he is willing to leave as a loan
V.
account.
vi
The partners in the new firm are to start on an equal footing so far as capital accounts are
concerned. Pee is to contribute cash of GH¢82,091.
The original partner in the old firm who has the higher investment will draw out cash so
that his capital account balances equal those of his new partners.
vi
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