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Balance as taken over 1.65,750 95,250 1.43.333 71.667 1,65,750 2,38,583 71,667 Adjustment for Goodwill -10.000 +11.667 -1.667 1,55,750 2,50 250 70,000 Total capital, 34,20,000 in
Balance as taken over 1.65,750 95,250 1.43.333 71.667 1,65,750 2,38,583 71,667 Adjustment for Goodwill -10.000 +11.667 -1.667 1,55,750 2,50 250 70,000 Total capital, 34,20,000" in the new ratio of 3:2:1, taking T's Capital as the basis 2.10.000 1.40.000 70.000 Transfer to Current Account 54,250 (Dr.) 1.10,250 (Cr.) 'T's Capital is 70,000 and it is 1/6 of total. The total therefore is 24,20,000 Illustration 2 On 31st March 2012, Sri Raman acquires on payment of 780,000 the business of M/S Gupta and Singh taking over at book value the following assets and liabilities: Debtors 35,000 Furniture 3,000 Stock 46.000 Creditors 10,000 There was no change between 1st January, 2012 and 31st March, 2012 in the book value of the assets and liabilities not taken over. The same set of books has been continued after the acquisition and no entries of the acquisition have been passed except for the payment of 780,000 made by Sri Raman From the following balance sheet and trial balance prepare Business Purchase Account, Profit and Loss Account for the year ended 31st December 2012 and Balance Sheet at that date. Balance Sheet as at December, 2011 Llabilities Assets Capital Accounts Furniture 3.000 Sri Gupta 30,000 Investments 5,000 Sri Singh 20,000 50,000 Insurance Policy 2.000 Bank Loan 18,000 Stock 40,000 Creditors 12,000 Debtors 30.000 80,000 80,000 025 On 31st December 2012 the trial balance is: 40,000 3,000 5,000 2.000 80,000 18,000 Stock Fumiture Investment Insurance Policy Business Purchase Account Bank Loan Capital: Gupta Singh Raman Bank Debtors Creditors Purchases Expenses Sales 30.000 20.000 30,000 3.000 48,000 15.000 3,20,000 12,000 4,00.000 5.13.000 5.13,000 Closing Stock 750,000
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