Radha and Shyam were the partners in a firm sharing profits and losses in the ratio of 2:3 respectively. The balance-sheet of their firm as on 31-3-2011 was as under:
4,45,000
4,78,400
B. S. SHAH PRAKASHAN
Balance Sheet
Assets
Rs.
Liabilities
Goodwill
Rs.
Capital accounts:
Building
25,000
Radha
80,000
12% Gopal's loan
Profit and Loss Account
Shyam 1,00,000
1,80,000
Machinery
1,20,00
10,000
Investments in the bonds of
23,000
50,000
Narmada Nigam
60,000
Debtors
75,000
15,000
Creditors
Bad debts
5,000
70,000
Stock
35,000
Cash-bank balance
12,000
On 1-4-'11 the firm was converted into "Radheshyam Co. Ltd. Conditions of conversion and other information are as under
(1) The company has to take all the assets and creditors of the firm. (ii) The goodwill of the firm is to be valued at twice the average profit of last three years. The total profit of last three years amounted to Rs. 1,20,000.
(in) The building and machinery are to be valued at Rs. 1,50,000 and Rs. 25,000 respectively. The investments are to be valued at Rs. 20,000.
(iv) Debtors are to be taken subject to 10% bad debt reserve.
(v) The remaining assets are to be taken as per book value.
(vi) Against purchase price the company has to give 10,000 equity shares of Rs. 10 each at a premium of 10%, Debentures of Rs. 1,00,000 at a discount of 5% and the remaining amount in cash.
(vii) Shyam paid up Gopal's loan, alongwith accrued interest thereon for one year.
(viii) The firm paid dissolution expenses of Rs. 4,000.
The shares and debentures received from the company are to be shared by the partners in their profit sharing ratio and the balance payment is to be made in cash.
From the above information prepare:
(i) Realisation Account
(ii) Partners' Capital Accounts
(iii) Cash-bank Account.
[Guj. Uni., F.Y., April
September 21, 2024