Accountancy is all about getting your calculations right. Here are some important questions in the run up to the Class 12 Boards that are important and can help you score well.
Q1 Calculate interest on ­drawing if Ravi withdrew Rs. 80,000 during the year. Interest will be charged at 12%.
Sol. As the date on which amount was withdrawn is not given in the question, we will assume that Ravi withdrew Rs. 80,000 in the middle of the year.
Therefore, interest on drawing = 80,000 x (12/100) x (6/12) = 4,800.
Q2 X and Y are partners sharing profits and losses in the ratio of 3:2. Z was admitted as a new partner for (1/5) th share. He brings Rs. 30,000 as capital but doesn’t bring his share of goodwill in cash. Capital of X and Y are Rs. 20,000 and Rs. 50,000 ­respectively. Pass the ­journal entry for goodwill.
Sol. In the problem the value of goodwill is not given but the journal entry for goodwill is required. Therefore,it is a case of hidden
First, we have to calculate value of goodwill. For this, following procedure is followed.
(a) Total capital = capital of new partner × reciprocal of his share = 30,000 × 5 = 1,50,000
(b) Combined capital = Capital of old partner + Capital of new partner. = 20,000 + 50,000 + 30,000 = 1,00,000
(c) Goodwill of firm = total capital – combined capital = 1,50,000 – 1,00,000 = 50,000
(d) New partner’s share in goodwill = goodwill × his share in profit = 50,000 × (1/5) = 10,000
In this case Z doesn’t bring his share of goodwill in cash then his share will be taken out of capital.
Q3 A and B are partners in a firm sharing profits equally. After the distribution of profits in the ratio 5:3:2, their capitals were Rs. 3,50,000; Rs. 2,30,000 and Rs. 1,20,000. It was observed that interest on capital at 10% was not provided and Rs. 10,000 salary to C was also not provided.
Profit during the year was Rs. 1,00,000. Pass a ­single entry to rectify the above error.
Sol. Step 1:
First find out whether opening capital or closing capital is given in the question.
In the above question closing capitals are given, therefore we need to find the opening capital first. [If opening capitals are given then interest will be calculated on the same amount].
Formula for calculating opening capital
Opening capital = closing capital – profits + drawings.
As drawings are not given in the question, we will subtract profit to find opening capital.
It is mentioned in the question that firm earned a profit of Rs. 1,00,000, which is divided in the ratio 5:3:2.
Opening capital of:
A = 3,50,000 – 1,00,000 × (5/10) = 3,00,000
B = 3,30,000 – 1,00,000 × (3/10) = 2,00,000
C = 1,20,000 – 1,00,000 × (2/10) = 1,00,000
Now provide interest on opening capital
Interest on A’s capital : 30,000
Interest on B’s capital : 20,000
Interest on C’s capital : 10,000