Read the following passage and answer the question.
X, Y, Z were partners sharing profits and losses in the ratio of 4:3:2. Z died on 30 June 2020 on which date his capital is ₹1,00,000, and after doing all adjustments his capital balance will be ₹1,74,000. His share of profit from the closing of last year till his death is ₹7,500. Z's executor is paid ₹14,000 on Ist July 2020 and the balance in 2 equal annual installments starts from 30th June,2021 with interest @ 6%p.a. Accounts are closed on 31st March.
How much amount is transferred to the Z's executor account?
Answer & explanation
Correct answer: option 2
The correct answer is option 2- ₹1,74,000.
Total due balance to Z is 1,74,000 which is transferred to executor account. from this balance 14,000 is paid immediately and the Balance is paid in 2 equal installments and the amount paid to the executor is ₹1,60,000. This will be paid into 2 equal annual installments means 80,000 each year plus interest.
Z's Executor Account
|
Date |
Particulars |
Amount (₹) |
Date |
Particulars |
Amount (₹) |
|
1 July 2020 |
To Bank A/c |
14,000 |
30 June 2020 |
By Z’s Capital A/c |
1,74,000 |
|
31st March 2021 |
To Balance c/d |
1,67,200 |
31st March 2021 |
By Interest A/c |
7,200 |
|
|
|
1,81,200 |
|
|
1,81,200 |
|
|
|
|
|
|
|
|
30 June 2021 |
To Bank A/c |
89,600 |
1st April 2021 |
By Bal b/d |
1,67,200 |
|
31st March 2022 |
To Balance c/d |
83,600 |
30 June 2021 |
By Interest A/c |
2,400 |
|
|
|
|
31st March 2022 |
By Interest A/c |
3,600 |
|
|
|
1,73,200 |
|
|
1,73,200 |
|
|
|
|
|
|
|
|
30 June 2022 |
To Bank A/c |
84,800 |
1st April 2022 |
By Bal b/d |
83,600 |
|
|
|
|
30 June 2022 |
By Interest A/c |
1,200 |
|
|
|
84,800 |
|
|
84,800 |