In this article, I have provided Admission of a Partner TS Grewal Solutions 2025-26. You can find the solutions of specifically Q41 to Q50 here. If you have any doubts regarding any of these questions, you can ask in the comments. I will try to resolve your doubts as soon as possible.
Topics Discussed
Question 41: (Asin and Shreyas)
Asin and Shreyas are partners in a firm. They admit Ajay as a new partner with 1/5th share in the profits of the firm. Ajay brings 5,00,000 as his share of capital. The value of the total assets of the firm was 15,00,000 and outside liabilities were valued at 5,00,000 on that date. Give necessary Journal entry to record goodwill at the time of Ajay’s admission. Also show your workings.
Answer:
| Journal | ||||||
| Date | Particulars | L.F. | Debit | Credit | ||
| Ajay’s Capital A/c | Dr. | 2,00,000 | ||||
| To Asin’s Capital A/c | 1,00,000 | |||||
| To Shreya’s Capital A/c | 1,00,000 | |||||
| (Ajay’s share of goodwill distributed among the old partners in their sacrificing ratio 1:1.) | ||||||
Working Notes:
Calculation of Goodwill brought in by Ajay:
| Value of firm’s goodwill | = Capitalised value of the firm – Net worth |
| Capitalised value of the firm | = Share of Ajay’s capital × Reciprocal of Ajay’s share= 5,00,000 ×5/1= 25,00,000 |
| Net worth of the new firm | = Total assets-Outside liabilities + Ajay’s capital= 15,00,000 – 5,00,000 + 5,00,000=15,00,000 |
| Value of firm’s goodwill | = Capitalised value of firm – Net worth of the new firm=25,00,000 – 15,00,000 = 10,00,000 |
| Ajay’s share of goodwill | = 10,00,000 × 1/5= 2,00,000 |
Question 42: (Arun and Vijay)
Arun and Vijay are partners in a firm sharing profit & loss in the ratio of 3: 2.
| BALANCE SHEET (Extract) | |||
| Liabilities | Rs. | Assets | Rs. |
| Machinery | 2,00,000 | ||
If the value of machinery in the Balance Sheet is excess by 33 1/3, find the value of machinery to be shown in the New Balance Sheet.
Answer:
If the value of machinery in the Balance Sheet is excess by 33 1/3
Then the book value is 100+33 1/3= 133 1/3
Excess Value of Machinery is 2,00,000×33 1/3 ÷ 133 1/3
Or
= 2,00,000×100/3 ×3/400 = 50,000
Value of machinery to be shown in the New Balance Sheet = 2,00,000-50,000= 1,50,000
Question 43: (Pass Entries in the firm’s journal)
Pass entries in the firm’s Journal for the following on admission of a partner:
(i) Machinery be reduced by 16,000 and Building be appreciated by 40,000.
(ii) A provision be created for Doubtful Debts @ 5% of Debtors amounting to 80,000.
(iii) Provision for warranty claims be increased by 12,000.
(iv) Furniture (Book Value 50,000) is to be reduced by 40%.
(v) Furniture (Book Value 50,000) is to be reduced to 40%.
Answer:
| Journal | |||||
| Date | Particulars | L.F. | Debit | Credit | |
| (i) a. | Revaluation A/c | Dr. | 16,000 | ||
| To Machinery A/c | 16,000 | ||||
| (Being Machinery be reduced) | |||||
| b. | Building A/c | Dr. | 40,000 | ||
| To Revaluation A/c | 40,000 | ||||
| (Being Building be appreciated) | |||||
| (ii) | Revaluation A/c | Dr. | 4,000 | ||
| To Provision for Doubtful Debts A/c | 4,000 | ||||
| (Being provision be created for Doubtful Debts @ 5% of Debtors amounting to 80,000) | |||||
| (iii) | Revaluation A/c | Dr. | 12,000 | ||
| To Provision for Warranty Claims A/c | 12,000 | ||||
| (Being Provision for warranty claims be increased) | |||||
| (iv) | Revaluation A/c | Dr. | 20,000 | ||
| To Furniture A/c | 20,000 | ||||
| (Being Furniture (Book Value 50,000) is to be reduced by 40%) | |||||
| (v) | Revaluation A/c | Dr. | 30,000 | ||
| To Furniture A/c | 30,000 | ||||
| (Being Furniture (Book Value 50,000) is to be reduced to 40%) | |||||
Question 44: (Pass entries in firm’s journal)
Pass entries in firm’s Journal for the following on admission of a partner:
(i) Unrecorded Investments worth 20,000 are to be accounted.
(ii) Unrecorded liability towards suppliers for 5,000 is to be accounted.
(iii) An item of 1,600 included in Sundry Creditors is not likely to be claimed and hence should be written back.
Answer:
| Journal | |||||
| Date | Particulars | L.F. | Debit | Credit | |
| (i) | Investment A/c | Dr. | 20,000 | ||
| To Revaluation A/c | 20,000 | ||||
| (Investments recorded) | |||||
| (ii) | Revaluation A/c | Dr. | 5,000 | ||
| To Creditors A/c | 5,000 | ||||
| (Liability recorded) | |||||
| (iii) | Creditors A/c | ||||
| To Revaluation A/c | Dr | 1,600 | |||
| (Liability decreased) | 1,600 | ||||
Question 45: (X and Y)
X and Y are partners sharing profits in the ratio of 3 : 2. They admitted Z as a partner for 1/4th share of profits. At the time of admission of Z, Investments appeared at 80,000. Half of the investments to be taken by X and Y in their profit-sharing ratio at book value. Remaining investments were valued at 50,000. Pass the necessary Journal entries.
Answer:
| Journal | |||||
| Date | Particulars | L.F. | Debit | Credit | |
| (i) | X’s Capital A/c | Dr. | 24,000 | ||
| Y’s Capital A/c | Dr. | 16,000 | |||
| To Investments A/c | 40,000 | ||||
| (Half of the investments taken over by X and Y) | |||||
| (ii) | Investment A/c | Dr. | 10,000 | ||
| To Revaluation A/c | 10,000 | ||||
| (Value of investments increased) | |||||
| (iii) | Revaluation A/c | Dr. | 10,000 | ||
| To X’s Capital A/c | 6,000 | ||||
| To Y’s Capital A/c | 4,000 | ||||
| (Profit on revaluation transferred to Partners’ Capital A/c) | |||||
Question 46: (X and Y)
X and Y are partners in a firm sharing profits in the ratio of 3 : 2. They admitted Z as a partner and fixed the new profit-sharing ratio as 3 : 2 : 1. At the time of admission of Z, Debtors and Provision for Doubtful Debts appeared at 50,000 and 5,000 respectively all debtors are good. Pass the necessary Journal entries.
Answer:
| Journal | |||||
| Date | Particulars | L.F. | Debit | Credit | |
| (i) | Provision for Doubtful Debts A/c | Dr. | 5,000 | ||
| To Revaluation A/c | 5,000 | ||||
| (Provision on Debtors reduced) | |||||
| (ii) | Revaluation A/c | Dr. | 5,000 | ||
| To X’s Capital A/c | 3,000 | ||||
| To Y’s Capital A/c | 2,000 | ||||
| (Profit on Revaluation transferred to Partners’ Capital A/c) | |||||
Question 47: (Ashok and Bhaskar)
Ashok and Bhaskar are partners in a firm sharing profits in the ratio of 3 : 2. They admitted Chaman as a partner for 1/4th share of profits. At the time of admission of Chaman, Debtors and Provision for Doubtful Debts appeared at ` 76,000 and ` 8,000 respectively. ` 6,000 of the debtors proved bad. A provision of 5% is to be created on Sundry Debtors for doubtful debts. Pass the necessary Journal entries.
Answer:
| Journal | |||||
| Date | Particulars | L.F. | Debit | Credit | |
| (i) | Bad Debts A/c | Dr. | 6,000 | ||
| To Debtors A/c | 6,000 | ||||
| (Bad debts incurred) | |||||
| (ii) | Provision for Doubtful Debts A/c | Dr | 6,000 | ||
| To Bad Debts A/c | 6,000 | ||||
| (Bad debts adjusted) | |||||
| (iii) | Revaluation A/c (WN 1) | Dr. | 1,500 | ||
| To Provision for Doubtful Debts A/c | 1,500 | ||||
| (Provision created) | |||||
| (iv) | Ashok’s Capital A/c | Dr. | 900 | ||
| Bhaskar’s Capital A/c | Dr. | 600 | |||
| To Revaluation A/c | 1,500 | ||||
| (Loss on revaluation transferred to Partners’ Capital A/c) | |||||
Working Notes:
WN1: Calculation of Provision for Doubtful Debts
Provision to be created = (76,000 – 6,000)×5/100= 3,500
Old Provision = 2,000
New Provision to be created = 3,500 – 2,000 = 1,500
Question 48: (Admission of partner Suresh)
At the time of admission of a partner Suresh, assets and liabilities of Ramesh and Nareshwere revalued as follows:
(a) A Provision for Doubtful Debts @10% was made on Sundry Debtors (Sundry Debtors 50,000).
(b) Creditors were written back by 5,000.
(c) Building was appreciated by 20% (Book Value of Building 2,00,000).
(d) Unrecorded Investments were valued at 15,000.
(e) A Provision of 2,000 was made for an Outstanding Bill for repairs.
(f) Unrecorded Liability towards suppliers was 3,000.
Pass necessary Journal entries.
Answer:
| Journal | |||||||
| Date | Particulars | L.F. | Debit | Credit | |||
| (i) | Revaluation A/c | Dr. | 10,000 | ||||
| To Provision for Doubtful Debts A/c | 5,000 | ||||||
| To Reserve for outstanding Repairs Bill A/c | 2,000 | ||||||
| To Creditors A/c | 3,000 | ||||||
| (Increase in liabilities, decrease in assets and creation of reserves and provisions transferred to Revaluation Account) | |||||||
| (ii) | Creditors A/c Dr. | 5,000 | |||||
| Building A/c Dr. | 40,000 | ||||||
| Investments A/c Dr. | 15,000 | ||||||
| To Revaluation A/c | 60,000 | ||||||
| (Increase in assets and decrease in liabilities transferred to Revaluation Account) | |||||||
| Revaluation A/c | Dr. | 50,000 | |||||
| To Old Partners’ Capital A/c | 50,000 | ||||||
| (Profit on Revaluation transferred to Partners’ Capital) | |||||||
Question 49: (Om and Shiv)
Om and Shiv are partners in a firm sharing profits equally.
| BALANCE SHEET (Extract) | |||||
| Liabilities | Rs. | Assets | Rs. | ||
| DebtorsLess: Provision for Doubtful Debts | 1,50,000-15,000 | 1,35,000 | |||
An amount of 12,000 due from Mohan, a debtor, is to be written off as no longer receivable. Provision for Doubtful Debts on remaining debtors is to be maintained at the current rate.
What amount of Provision for Doubtful Debts should be credited to maintain its current rate?
Answer:
Current rate Provision for Doubtful debts is 15,000×100/1,50,000=10%
| Debtors | = | 1,50,000 |
| Less: Bad Debts | = | 12,000 |
| Debtors After Bad Debts | = | 1,38,000 |
| Provision for Doubtful Debts @10% is to be maintained | = | 13,800 |
| Firm already has Provision of 15,000 | ||
| Provision for Doubtful Debts Before Adjustment of Bad Debts | = | 15,000 |
| Less: Bad Debts | = | 12,000 |
| Balance of Provision for Doubtful Debts after Adjustment of Bad Debts | = | 3,000 |
| Amount of Provision for Doubtful Debts should be credited to maintain its current rate =13,800-3,000= 10,800 |
Question 50: (Ashish and Vishesh)
Ashish and Vishesh were partners sharing profits and losses in the ratio of 3:2. Their Balance Sheet at 31st March, 2022 was as under:
| BALANCE SHEET OF ASHISH AND VISHESH as at 31st March, 2022 | |||||||
| Liabilities | Rs. | Assets | Rs. | ||||
| Creditors | 30,000 | Cash at Bank | 50,000 | ||||
| Outstanding Electricity Bill | 20,000 | Debtors | 80,000 | ||||
| Capital Acs: | Less: Provision for Bad Debts | 2,000 | 78,000 | ||||
| Ashish | 3,00,000 | Stock L | 12,000 | ||||
| Vishesh | 2,00,000 | 5,00,000 | Machinery | 3,00,000 | |||
| Profit and Loss A/c | 10,000 | ||||||
| 5,50,000 | 5,50,000 | ||||||
On 1st April, 2022, Manya was admitted into the firm with 1/4th share in the profits on the following terms:
(i) Manya will bring 1,00,000 as her capital and 50,000 as her share of goodwill premium in cash.
(ii) Outstanding electricity bill will be paid off.
(iii) Stock was found over valued by 12,000.
Pass the necessary Journal entries in the books of the firm on Manya’s admission. (CBSE 2023)
Answer:
| Date | Particulars | Dr. | Cr. | |
| (i) | Outstanding Electricity Bill A/c | Dr. | 20,000 | |
| To Bank A/c | 20,000 | |||
| (Being Outstanding electricity bill will be paid off) | ||||
| (ii) | Revaluation Ac | Dr. | 12,000 | |
| To Stock A/c | 12,000 | |||
| (Being Stock was undervalued) | ||||
| (iii) | Ashish’s Capital A/c | Dr. | 7,200 | |
| Vishesh’s Capital A/c | Dr. | 4,800 | ||
| To Revaluation A/c | 12,000 | |||
| (Being loss transferred in old ratio) | ||||
| (iv) | Ashish’s Capital A/c | Dr. | 6,000 | |
| Vishesh’s Capital A/c | Dr. | 4,000 | ||
| To Profit & Loss A/c | 10,000 | |||
| (Being accumulated loss transferred in old ratio) | ||||
| (v) | Bank A/c | Dr. | 1,50,000 | |
| To Manya’s Capital A/c | 1,00,000 | |||
| To Premium for Goodwill A/c | 50,000 | |||
| (Being capital and her share of goodwill premium brought) | ||||
| (vi) | Premium for Goodwill A/c | Dr. | 50,000 | |
| To Ashish’s Capital A/c | 30,000 | |||
| To Vishesh’s Capital A/c | 20,000 | |||
| (Being Premium for Goodwill transferred in sacrificing ratio) |