Q. 120. Risha and Nisha were …
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Q. 120. Risha and Nisha were partners. The partnership deed provides:
(1) That the accounts be balanced on 31st December each year.
(ii) The profits be divided as follows:
Risha one-half, Nisha one-third and carried to Reserve account one-sixth.
(ii) That in the event of death of a partner, her executor will be entitled to the following:
(a) The capital to her credit at the date of death.
(b) Her proportion of profit to date of death based on the average profits of the last three completed years.
(c) Her share of goodwill based on three year's purchase of the average profits for the three preceding completed years.
On 31st December, 2020 the Trial Balance was as under:
Particulars
Risha's Capital
Nisha's Capital
Reserves
Bills Receivables
Investments
Cash
Creditors
Dr. (3)
Cr. (3)
90,000
60,000
30,000
50,000
40,000
1,10,000
20,000
2,00,000
2,00,000
The profits for the three years were: 2018 ₹4,200; 2019 ₹3,900 and 2020 ₹4,500. Nisha died on 31st May, 2021. Draw up the deceased Partner's Capital A/c and Executor's A/c.
Ans. Balance due to Nisha's Executor's ₹77,740.]
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