Partnership:-Death of a Partner.

A,B and C are partners sharing profits and losses in the proportion of 3:2:1 and their balance sheet as on 31st December,2002 stood as under:
LIABILITIES Bill Payable Creditors Reserves Capitals A B C 7560 12300 3000 10000 6000 4000 ASSETS Cash in Hand Bank Debtors Bills Receivable Stock Investment Building 250 960 7450 3300 12470 10430 8000 42860

20000 42860

B died on 28th February,2003 and according to the deed of the said partnership,his executors are entitled to be paid as under: i. ii. iii. iv. The capital to his credit at the time of his death and interest upon the time of his death @6% p.a. His proportionate share of reserve. His share of profit for the period based on the figure of the previous year. Goodwill according to his share of profits to be calculated by taking twice the amount of the average profits of last three years.The profits of the previous years were:Rs 7800 for 2000;Rs 9000 for 2001;RS9600 for 2002.

The investments were sold for Rs 16,200 and his executors were paid out. Pass necessary Journal entries & write the accounts of the executors of B.

DATE

PARTICULARS Bs Capital A\C Dr. To Bs Executor A\C Reserves A\C Dr .

L\F

DEBIT AMT RS. 6000

CREDIT AMIT. RS.

6000 3000 1500 500 1000 60 533 593

To As Capital A\C To Cs Capital A\C To Bs Executor A\C Interest on Capital A\C Dr. Share on Profit A\C Dr. To Bs Executor A\C

Goodwill A\C

Dr.

5867 5867

To Bs Executor A\C

Profit on Sale of Investment A\C Dr. To As Capital A\C To Cs Capital A\C To Bs Executor A\C

5770 2885 962 1923

Bank

A\C

Dr.

16200 5770 10430

To Profit on Investment A\C To Investment A\C

Bs Executor A\C To Bank A\C

Dr.

15383 15383