Leasehold premises less written off 32.300 3,09,800 030 Less: Closing liabilities: Sundry Creditors 50,000 Bank overdraft 20.000 _70.000) Closing Net Assets 2,39,800 Less: Opening combined capital: A-3 (1.40,000 - 13.000 - 10,000) 1.17,000 B - (1,30,000 -13,000 -6,000) 1.11,000 (2.28,000) Profit before adjustment of drawings 11,800 Add: Combined drawings during the 6 months (equal to profit) 11.800 Profit for 6 months 23.600 (2) Ascertainment of purchase consideration: Closing net assets (as above) 2,39,800 + Goodwill 3 1,00,000 = 7 3,39,800 Illustration 7 A, B and C were in partnership sharing profits and losses 3:2:1. There was no provision in the agreement for interest on capitals or drawings. A died on 31.12.2011 and on that date, the partners' balance were as under: Capital Account: A - 60,000; B- 40.000; C-320,000 Current Account A - 29,000, B-720,000: C - 5,000 (Dr.). By the partnership agreement, the sum due to A's estate was required to be paid within a period of 3 years, and minimum instalment of 20,000 each were to be paid, the first such instalment falling due immediately after death and the subsequent instalments at half-yearly intervals. Interest @5% p.a. was to be credited half-yearly ascertaining share, goodwill not recorded in the books) was to be valued at 60,000 and the assets, excluding the Joint Endowment Policy (mentioned below), were valued at * 36,000 in excess of the book values. No Goodwill Account was raised and no alteration was made to the book values of fixed assets. The Joint Assurance policy shown in the books at 20.000 matured on 1.1.2011, realising 26,000; payments of 20,000 each were made to A's Executors on 1.1.2011, 30.6.2011 and 31.12.2011. B and C continued trading on the same terms as previously and the net profit for the year to 31.12.2011 (before charging the interest due to A's estate) amounted to 32,000. During that period, the partners drawings were: B-15,000; and C 8,000. On 1.1.2012, the partnership was dissolved and an offer to purchase the business as a going concem for 1,40,000 was accepted on that day. A cheque for that sum was received on 30.6.2012 The balance due to A's estate, including interest, was paid on 30.6.2012 and on that day. B and C received the sums due to them. You are required to write-up the Partners' Capital and Current Accounts from 1.1.2011 to 30.6.2012. Show also the account of the executors of A