Accountancy > Accounting For Partnership Firms > Death Of A Partner
Raja, Bharat and Vedika were partners in a firm sharing profits and losses in the ratio of 2:2:1. Their Balance Sheet as on 31st March, 2024 was as follows:
| Liabilities | Amount (₹) | Assets | Amount (₹) |
|---|---|---|---|
| Creditors | 80,000 | Bank | 15,000 |
| General Reserve | 50,000 | Stock | 70,000 |
| Capitals: | Debtors | 85,000 | |
| Raja 1,10,000 | Furniture | 1,20,000 | |
| Bharat 1,00,000 | Machinery | 1,40,000 | |
| Vedika 90,000 | 3,00,000 | ||
| Total | 4,30,000 | Total | 4,30,000 |
Vedika died on 31st July, 2024. According to the partnership deed, her legal representatives are entitled to the following: (i) Balance in her capital account (ii) Interest on capital @ 8% p.a. (iii) Her share in the profit upto the date of death to be calculated on the basis of last year's profit. Vedika's share of profit was ₹ 3,000. (iv) Her share of goodwill calculated on the basis of two years purchase of average profits of last three years. The average profit of last three years was ₹ 40,000. Vedika's drawings upto the date of death were ₹ 12,000.
Prepare Vedika's Capital Account to be rendered to her executors.
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