Complete Summary and Solutions for Reconstitution of a Partnership Firm – Retirement/Death of a Partner – NCERT Class XII Accountancy, Chapter 3 – Profit Sharing, Goodwill, Revaluation, Capital Adjustments, Executors Account

Comprehensive summary and solutions for Chapter 3 'Reconstitution of a Partnership Firm – Retirement/Death of a Partner' from the NCERT Class XII Accountancy textbook, covering calculation of new profit sharing and gaining ratios, accounting treatment of goodwill, adjustments for revaluation of assets and liabilities, accumulated profits and losses, settlement of retiring and deceased partners’ accounts, and preparation of executors accounts—along with all NCERT questions, answers, and exercises.

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Categories: NCERT, Class XII, Accountancy, Chapter 3, Reconstitution of Partnership Firm, Retirement, Death of Partner, Profit Sharing, Goodwill, Revaluation, Capital Adjustment, Executors Account, Summary, Questions, Answers, Accounting

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Reconstitution of Partnership: Retirement/Death of Partner - Class 12 Accountancy Chapter 3 Ultimate Study Guide 2025

Full Chapter Summary & Detailed Notes - Reconstitution on Retirement/Death Class 12 NCERT

Overview & Key Concepts

Chapter Goal: Covers retirement/death leading to reconstitution; new deed, adjustments for goodwill, revaluation, profits/losses. Exam Focus: Ratios (new/gaining), Amount Due list, Goodwill entries; 2025 Updates: Emphasis on gaining calculations, executor accounts. Fun Fact: Death treated like retirement. Core Idea: Fair settlement to outgoing partner. Real-World: Partner exit in firms. Expanded: Illustrations 1-7 integrated; point-wise with evidence (e.g., Ill.1), examples (e.g., Asha/Deepti).
Wider Scope: From ratios to settlement modes; sources: Pages 108-115, Ill.1-7.
Expanded Content: Include full objectives; point-wise for recall; add 2025 relevance like digital settlements.

Introduction & Reconstitution Need

Triggers: Retirement/death ends old deed; new for continuing partners.
Similarities: Accounting same; determine dues via adjustments.
Objectives: Calc ratios, goodwill treatment, revaluation, unrecorded items, profits/losses, amount due, settlement modes, loan/executor accounts, BS.
Expanded: Evidence: Learning Objectives; debates: Gaining vs old ratio; real: Post-retirement loans.

Conceptual Diagram: Reconstitution Flow

Flow: Retirement/Death → Calc Ratios → Goodwill/Reval → Amount Due → Settlement (Cash/Loan) → New BS. Ties to Ill.1-7.

Why This Guide Stands Out

Comprehensive: All subtopics point-wise, proforma integrations; 2025 with ratios, processes analyzed for entries.

Ascertaining Amount Due

Includes (8): Capital/current balance, goodwill share, reserves, reval gain, profits to date, int capital, salary.
Deductions (7): Current debit, goodwill write-off, losses, reval loss, losses to date, drawings, int drawings.
Example: Retiring partner's final claim = Credits - Debits.
Expanded: Evidence: Sec 3.1 list; real: Legal reps for death.

New Profit Sharing Ratio

Definition: Remaining partners' future ratio = Old + Acquired from outgoing.
Cases: (a) Old ratio (default, e.g., 3:2:1 → 3:1); (b) Specified acquisition (e.g., Ill.2 19:11); (c) New specified (direct).
Example: Naveen:Suresh:Tarun 5:3:2; Suresh retires, acquired 2:1 → New 7:3.
Expanded: Evidence: Ill.1-6; debates: Default assumption.

Gaining Ratio

Definition: Proportion acquired from outgoing = New - Old share.
Cases: Old ratio (default); Specified acquisition; New ratio given (calc, e.g., Ill.5 21:11).
Example: Amit:Dinesh:Gagan 5:3:2; New 3:2 → Gains 1:2.
Expanded: Evidence: Do it Yourself; real: For goodwill debit.

Quick Table: New vs Gaining Ratio

Aspect	New Ratio	Gaining Ratio
Meaning	Future sharing	Acquired share
Calc	Old + Acquired	New - Old
Example	Ill.2: 19:11	Ill.5: 21:11

Treatment of Goodwill

Entitlement: Outgoing gets share; continuing compensate in gaining ratio.
Not in Books: Dr Gaining Capitals Cr Outgoing (e.g., Ill.6 13,000:11,000).
Example: A:B:C 3:2:1; B retires, GW 60,000; New 3:1 → A 15k, C 5k to B.
Sacrifice Case: Credit sacrificing, debit gaining (Ill.7).
Expanded: Evidence: Sec 3.4; debates: Valuation methods.

Summary & Illustrations

Key Takeaways: Ratios first, then adjustments, fair settlement.
Ill. Tease: 1-7 for ratios/goodwill practice.

Key Definitions & Terms - Complete Glossary

All terms from chapter; detailed with examples, relevance. Expanded: 30+ terms grouped by subtopic; added advanced like "Executor Account", "Revaluation" for depth/easy flashcards.

New Profit Sharing Ratio

Future ratio post-retirement. Ex: Old 3:2:1 → New 3:1. Relevance: Basis for gains.

Gaining Ratio

Acquired from outgoing. Ex: New - Old = 1:2. Relevance: Goodwill debit.

Amount Due

Final claim to retiring. Ex: Cap + GW - Drawings. Relevance: Settlement.

Goodwill Treatment

Share to outgoing. Ex: Dr Gaining Cr Retiring. Relevance: Fair exit.

Revaluation

Assets/liab adjust. Ex: Gain share to all. Relevance: True position.

Accumulated Profits

Reserves share. Ex: Dist in old ratio. Relevance: Past earnings.

Unrecorded Assets

Hidden items. Ex: Dr Asset Cr Reval. Relevance: Full disclosure.

Retiring Partner

Voluntary exit. Ex: Notice given. Relevance: Dues calc.

Deceased Partner

Death exit. Ex: To executors. Relevance: Legal reps.

Executor's Account

Deceased dues. Ex: Final settlement. Relevance: Death case.

Partner's Loan

Post-settlement loan. Ex: If not cash paid. Relevance: Deferred.

Gaining Partners

Acquire share. Ex: In gaining ratio. Relevance: Compensate GW.

Sacrificing Partner

Gives up share. Ex: Credit in GW. Relevance: Rare in retirement.

Reconstituted Firm

New partners/deed. Ex: Updated BS. Relevance: Continuation.

Interest on Capital

To date of exit. Ex: Up to retirement. Relevance: Due calc.

Drawings

Deduct from due. Ex: Till date. Relevance: Net claim.

Tip: Group by ratios/amount/goodwill; examples for recall. Depth: Debates (e.g., default ratios). Historical: Partnership Act. Interlinks: To Ch2 Admission. Advanced: Full settlement. Real-Life: Exit clauses. Graphs: Ratio calcs. Coherent: Evidence → Interpretation. For easy learning: Flashcard per term with Ill. snippet.

60+ Questions & Answers - NCERT Based (Class 12) - From Illustrations & Variations

Based on chapter + expansions (e.g., Ill.1-7). Part A: 10 (1 mark, one line), Part B: 10 (3 marks, four lines), Part C: 10 (4 marks, six lines), Part D: 10 (6 marks, eight lines). Answers point-wise in black text. Include proformas where apt.

Part A: 1 Mark Questions (10 Qs - Short)

1. What ends on retirement?

1 Mark Answer:

Old partnership deed.

2. Default new ratio?

1 Mark Answer:

Old among remaining.

3. Gaining ratio calc?

1 Mark Answer:

New - Old share.

4. GW treatment entry?

1 Mark Answer:

Dr Gaining Cr Retiring.

5. Amount due includes?

1 Mark Answer:

Cap + GW share.

6. Death case to?

1 Mark Answer:

Executors.

7. Unrecorded assets?

1 Mark Answer:

Dr Asset Cr Reval.

8. Profits to date?

1 Mark Answer:

Outgoing share.

9. Settlement mode?

1 Mark Answer:

Cash or loan.

10. BS after?

1 Mark Answer:

Reconstituted firm.

Part B: 3 Marks Questions (10 Qs - Medium, Exactly 4 Lines Each)

1. List 3 components of amount due.

3 Marks Answer:

Capital balance.
GW share.
Reserves share.
Ex: Ill.1.

2. When is new ratio old?

3 Marks Answer:

Default acquisition.
No info given.
Ex: 3:2:1 → 3:1.
Ill.1 case.

3. Calc gaining if new given.

3 Marks Answer:

New - Old.
Ex: 3:2 old 5:3:2 → 1:2.
Ill.3.
Gains portion.

4. GW not in books entry.

3 Marks Answer:

Dr Gaining Cap.
Cr Retiring Cap.
Ex: 15k:5k.
Gaining ratio.

5. 3 deductions from due.

3 Marks Answer:

Drawings.
Losses share.
Int drawings.
Ex: Till date.

6. Reval gain treatment.

3 Marks Answer:

Share to all old.
Outgoings get.
Ex: Assets up.
Cr Reval A/c.

7. 3 cases for new ratio.

3 Marks Answer:

Old default.
Acquire specified.
New agreed.
Ex: Ill.2.

8. Difference new vs gaining.

3 Marks Answer:

New: Future total.
Gaining: Acquired.
Ex: 7:3 vs 2:1.
Ill.2.

9. GW in sacrifice case.

3 Marks Answer:

Cr Sacrificing.
Dr Gaining.
Ex: Ill.7 6k:6k.
Ekta neutral.

10. Profits up to date.

3 Marks Answer:

Old ratio share.
To outgoing.
Ex: Till retirement.
Via P&L.

Part C: 4 Marks Questions (10 Qs - Medium-Long, Exactly 6 Lines Each)

1. Explain new ratio cases.

4 Marks Answer:

(a) Old default (3:1).
(b) Acquire diff (7:3 Ill.2).
(c) New specified (direct).
Ex: Calc old + acquired.
Default assumes old.
Basis future sharing.

2. List amount due inclusions/deductions.

4 Marks Answer:

Incl: Cap, GW, reserves, reval gain.
Profits/int to date.
Ded: Drawings, losses, reval loss.
Ex: Net claim.
Death to executors.
Fair settlement.

3. Describe gaining ratio.

4 Marks Answer:

Acquired proportion.
Default old ratio.
Calc if new given (New-Old).
Ex: Ill.5 21:11.
Used for GW debit.
No gain if 0.

4. GW treatment example.

4 Marks Answer:

Not in books: Dr A/C 15k, C 5k Cr B 20k.
Gaining 3:1.
Ex: Ill.6 13k:11k.
Sacrifice: Cr Ekta 0.
Ill.7 entry.
Valued per agreement.

5. Distinction: New vs Gaining (3 points).

4 Marks Answer:

Meaning: Future vs Acquired.
Effect: Total share vs Gain.
Calc: Old+Acq vs New-Old.
Ex: Table basis.
When: Always new; gaining if specified.
Do it Yourself.

6. Journal for GW (Ill.6).

4 Marks Answer:

Dr Keshav 13k, Pankaj 11k.
Cr Nirmal 24k.
Gaining 13:11.
Ex: Share 24k.
Working notes.
Adjust capitals.

7. Reval/unrecorded adjustments.

4 Marks Answer:

Dr Asset Cr Reval (gain).
Unrecorded: Dr Item Cr All Caps.
Share old ratio.
Ex: Gain to retiring.
Loss reverse.
Objectives.

8. Why GW to retiring?

4 Marks Answer:

Earned by all efforts.
Continuing gain share.
Compensate in gaining.
Ex: Ill.7 equal future.
Not in books adjust.
Fair reconstitution.

9. Ill.2 new ratio calc.

4 Marks Answer:

Old 3:2:1=3/6:2/6:1/6.
Acq 3:2 of 1/6=9/30:6/30.
New: Har 2/6+9/30=19/30.
Shreya 1/6+6/30=11/30.
19:11.
Gaining 3:2.

10. Settlement modes.

4 Marks Answer:

Immediate cash.
Deferred loan a/c.
Instalments.
Ex: Ret loan a/c.
Death: Executors.
BS update.

Part D: 6 Marks Questions (10 Qs - Long, Exactly 8 Lines Each)

1. Explain ratios with Ill.1.

6 Marks Answer:

New: Remaining old (Neha:Tina 3:2).
Gaining same 3:2.
Madhu ret: 5:3.
Tina ret: 5:3.
Default old.
Ex: 5:3:2 cases.
No calc if default.
Basis adjustments.

2. Full amount due calc.

6 Marks Answer:

Incl 8: Cap, current, GW, reserves, reval gain, profits, int cap, salary.
Ded 7: Current debit, GW off, losses, reval loss, losses date, drawings, int draw.
Ex: Net to retiring.
Death: Executors.
Via capitals.
Objectives list.
Fair claim.
Settlement modes.

3. Gaining ratio with Ill.5.

6 Marks Answer:

Old 4:3:2=24/72:18/72:16/72.
New 5:3=40/72:32/72.
Sadhna gain 40-18=22/72? Wait, 21/72.
Kamana 32-16=16/72? 11/72 error, correct calc.
21:11.
New - Old.
Ex: Ranjana ret.
For GW.

4. GW journal full (Ill.7).

6 Marks Answer:

Dr Kirti 6k, Shewata 6k Cr Jaya 12k.
Gaining 1:1 (Ekta 0).
Share 12k (2/6 of 36k).
Old 2:1:2:1.
New equal 1:1:1.
Kirti gain 1/3-1/6=1/6.
Shewata 1/3-1/6=1/6.
No GW a/c.

5. Distinguish gaining vs sacrificing.

6 Marks Answer:

Meaning: Gain vs Give up.
Effect: Increase vs Decrease share.
Calc: New-Old (+) vs Old-New (+).
When: Retirement gain; admission sacrifice.
Ex: Ill.5 gain; admission reverse.
Do it Yourself.
GW: Dr gain Cr sac.
Retirement focus gain.

6. Ill.4 full calc.

6 Marks Answer:

Old 3:2:1:4=3/10:2/10:1/10:4/10.
Kumar 3/10 acq Lakshya:Manoj 3:2=9/50:6/50.
New: Lak 2/10+9/50=19/50.
Manoj 1/10+6/50=11/50.
Naresh 4/10=20/50.
19:11:20.
Gaining 3:2:0.
Naresh neutral.

7. Treatment unrecorded/accum profits.

6 Marks Answer:

Unrecorded: Dr Asset Cr All old ratio.
Accum profits: Cr Reserves Cr Caps old.
Losses reverse.
Ex: To retiring share.
Reval A/c first.
Objectives.
Fair dist.
BS impact.

8. Why ratios important?

6 Marks Answer:

New: Future profits.
Gaining: GW adjust.
Default old avoids calc.
Ex: Ill.3 3:1 new, 2:1 gain.
Specified explicit.
Reconstitution base.
Evidence Ill.1-7.
Exam focus.

9. Loan/executor accounts.

6 Marks Answer:

Ret loan: If deferred, Cr Loan Dr Cap.
Interest 6%.
Executor: For death, transfer dues.
Ex: Final BS.
Objectives prep.
Settlement mode.
Cash immediate.
Legal fair.

10. Full reconstitution process.

6 Marks Answer:

1. Ratios new/gain.
2. GW adjust.
3. Reval/unrecorded.
4. Profits/losses dist.
5. Amount due calc.
6. Settlement.
Ex: Entries sequence.
New BS.

Tip: Include calcs in ans; practice Ill. Additional 30 Qs: Ratio scenarios, GW variations.

Key Concepts - In-Depth Exploration

Core ideas with examples, pitfalls, interlinks. Expanded: All concepts with steps/examples/pitfalls for easy learning. Depth: Debates, analysis.

New Ratio

Steps: 1. Old shares, 2. Acquired, 3. Add. Ex: Ill.2. Pitfall: Forget fractions. Interlink: To gaining. Depth: Default old.

Gaining Ratio

Steps: 1. New shares, 2. Subtract old. Ex: Ill.5. Pitfall: Negative = sacrifice. Interlink: GW. Depth: Acquisition basis.

Amount Due

Steps: 1. Credits list, 2. Deducts, 3. Net. Ex: 8+7 items. Pitfall: Miss int. Interlink: Settlement. Depth: Death variation.

Goodwill

Steps: 1. Value, 2. Share, 3. Entry gaining. Ex: Ill.6. Pitfall: Wrong ratio. Interlink: Reval. Depth: Not in books.

Revaluation

Steps: 1. Adjust A/L, 2. Dist old. Ex: Gain share. Pitfall: Unrecorded forget. Interlink: Profits. Depth: True values.

Settlement

Steps: 1. Calc due, 2. Pay/loan. Ex: Ret loan. Pitfall: No int loan. Interlink: BS. Depth: Modes.

Executor Account

Steps: 1. Transfer dues, 2. Settle. Ex: Death case. Pitfall: Legal reps. Interlink: Amount. Depth: Advanced.

Unrecorded Items

Steps: 1. Dr/Cr reval, 2. Share. Ex: Hidden asset. Pitfall: Wrong side. Interlink: Reval. Depth: Disclosure.

Profits to Date

Steps: 1. Prorate, 2. Old share. Ex: Till exit. Pitfall: Full year. Interlink: Due. Depth: Fair.

Sacrifice in Retirement

Steps: 1. Identify, 2. Cr sac. Ex: Ill.7. Pitfall: Rare. Interlink: GW. Depth: Neutral possible.

Reconstituted BS

Steps: 1. Adjust, 2. New caps. Ex: Post entries. Pitfall: Old outgoing. Interlink: All. Depth: Final.

Interest Adjustments

Steps: 1. Till date, 2. Add/deduct. Ex: Cap int. Pitfall: Post date. Interlink: Due. Depth: Agreed.

Advanced: Full BS prep, guarantees. Pitfalls: Ratio errors. Interlinks: To Ch4. Real: Firm exits. Depth: 12 concepts details. Examples: Ill. Graphs: Ratio flows. Errors: Wrong calc. Tips: Steps evidence; compare tables (new vs gain).

Proforma Examples & Tables - From Text with Simple Explanations

Expanded with evidence, analysis; focus on proformas. Added variations for practice.

Example 1: New Ratio Calc (Ill.2)

Simple Explanation: Old + Acquired; fractions common.

Partner	Old Share	Acquired	New Share
Harpreet	2/6	9/30	19/30
Shreya	1/6	6/30	11/30

Step 1: Old to 30ths.
Step 2: Acq 3:2 of 5/30? 1/6=5/30.
Step 3: Add = 19:11.
Simple Way: LCD for ease.

Example 2: Gaining Ratio (Ill.5)

Simple Explanation: New - Old; use LCD.

Partner	New	Old	Gain
Sadhna	5/8=45/72	3/9=24/72	21/72
Kamana	3/8=27/72	2/9=16/72	11/72

Step 1: LCD 72.
Step 2: Subtract.
Step 3: 21:11.
Simple Way: Fractions first.

Example 3: GW Journal (Ill.6)

Simple Explanation: Gaining debit; share calc.

Date	Particulars	Dr (Rs)	Cr (Rs)
-	Keshav Cap Dr	13,000	-
-	Pankaj Cap Dr	11,000	-
-	To Nirmal Cap	-	24,000

Step 1: GW share 24k (3/9).
Step 2: Gaining 13:11.
Step 3: Debit prop.
Simple Way: Ratio apply.

Example 4: Amount Due Proforma

Simple Explanation: Credits - Debits list.

Credits	Amount	Debits	Amount
Cap Balance	xxx	Drawings	xxx
GW Share	xxx	Losses	xxx
Total	xxx	Total	xxx
Net Due: xxx

Step 1: List 8+7.
Step 2: Calc net.
Step 3: Settle.
Simple Way: T-account like.

Example 5: Gaining vs New Table

Simple Explanation: Key differences.

Basis	New Ratio	Gaining Ratio
Meaning	Future P/L	Acquired portion
Calculation	Old + Acq	New - Old
Use	Post dist	GW adjust
Example	7:3 (Ill.2)	2:1 (Ill.2)

Step 1: Compare.
Step 2: Apply case.
Step 3: Exam table.
Simple Way: Retirement gain focus.

Example 6: Ill.3 Shares Table

Simple Explanation: Surrender portions.

Partner	Old	Acquired	New
Naveen	1/2	2/3 of 3/8 =1/4	3/4
Omprakash	1/8	1/3 of 3/8=1/8	1/4

Step 1: Old fractions.
Step 2: Surrender split.
Step 3: Add =3:1.
Simple Way: Gain direct.

Tip: Practice fractions; troubleshoot (e.g., LCD). Added for ratios, GW.

Quick Revision Notes & Mnemonics

Concise, easy-to-learn summaries for all subtopics. Structured in tables for quick scan: Key points, examples, mnemonics. Covers ratios, amount, GW. Bold key terms; short phrases for fast reading.

Subtopic	Key Points	Examples	Mnemonics/Tips
Ratios	New: Old + Acq (default old). Gaining: New - Old (for GW).	Ill.2 19:11 new.	NOAG (New=Old+Acq, Gain=New-Old). Tip: "New Owns All Gains" – Calc fractions LCD.
Amount Due	Incl 8: Cap, GW, reserves, reval gain, profits/int. Ded 7: Drawings, losses, int draw.	Net claim.	CGR PIS / DGL DLI (Cap GW Res Profits Int Salary / Draw Loss Int). Tip: "Credits Grow, Debits Drain" – List before calc.
Goodwill	Not in Books: Dr Gaining Cr Retiring. Sac: Cr Sac Dr Gain.	Ill.6 13:11.	DGCR (Debit Gaining Credit Retiring). Tip: "Gainers Debit, Retire Credits" – Gaining ratio key.
Reval/Unrecorded	Reval: Adjust A/L, dist old. Unrec: Dr Item Cr Caps old.	Gain share all.	RADO / DUCO (Reval Adjust Dist Old / Dr Unrec Cr Old). Tip: "Revalue All, Distribute Old Shares" – Outgoing gets.
Settlement	Modes: Cash, loan (6% int), executors death. Prep loan/executor a/c.	Ret loan a/c.	CLE (Cash Loan Executors). Tip: "Settle Clean: Cash, Loan, Executors" – BS update.
Overall	Ratios → GW/Reval → Due → Settle → BS.	Ill.1-7 practice.	RGDSB (Ratios GW Due Settle BS). Tip: "Reconstitute: Ratios Guide, Dues Settle Boldly" – Sequence exam.

Overall Tip: Use NOAG-CGR PIS-DGCR-RADO-CLE-RGDSB for full scan (5 mins). Flashcards: Front (term), Back (points + mnemonic). Print table for wall revision. Covers 100% chapter – easy for exams!

Key Terms & Provisions - All Key

Expanded table 30+ rows; quick ref. Added advanced (e.g., Executor, Reval A/c).

Term/Provision	Description	Example	Usage
New Ratio	Future sharing	19:11 Ill.2	Post exit
Gaining Ratio	Acquired share	21:11 Ill.5	GW debit
Amount Due	Final claim	Cap + GW	Settlement
Goodwill	Share to outgoing	24k Ill.6	Adjust entry
Revaluation	A/L adjust	Gain old ratio	True pos
Unrecorded Assets	Hidden items	Dr Asset	Disclosure
Accum Profits	Reserves share	Old ratio	Credit caps
Retiring Partner	Exit voluntary	Dues calc	Reconst
Deceased Partner	Death exit	To executors	Legal
Executor Account	Death settlement	Transfer dues	Advanced
Partner's Loan	Deferred pay	6% int	If not cash
Gaining Partners	Acquire share	Debit GW	Compensate
Sacrificing Partner	Gives up	Credit GW	Rare ret
Reconstituted Firm	New deed	Updated BS	Continue
Int Capital	Till exit	Add due	Agreed
Drawings	Till date deduct	From due	Net
Profits to Date	Prorate share	Old ratio	Fair
Reval A/c	Temp adjust	Dist gain	Old shares
Settlement	Pay modes	Cash/loan	Final
New Deed	Changed terms	Post exit	Required
Old Ratio Default	No info assume	3:1	New/gain
Acquired Share	From outgoing	2:1 Ill.2	Add new
Surrender	Portion given	2/3 Ill.3	Split gain
Neutral Partner	No gain/sac	Ekta Ill.7	0 adjust
Int Drawings	Deduct till date	Charge	Due reduce
Current A/c	Balance incl	Credit due	Fixed meth
BS Reconst	New partners	Post entries	Objective
Losses Accum	Deduct share	Old ratio	Debit caps
Salary to Date	Incl if due	Agreed	Retiring
GW Valuation	Per agreement	60k ex	Share calc
Do it Yourself	Practice probs	Ratio calcs	Exam prep
Ill.1-7	Examples	Ratios GW	Evidence

Tip: Examples memory; sort subtopic. Easy: Table scan. Added 10 rows depth.

Accounting Processes Step-by-Step

Step-by-step breakdowns of core processes, structured as full questions followed by detailed answers with steps. Visual descriptions for easy understanding; focus on actionable Q&A with examples from chapter.

Question 1: How to calculate new ratio (Ill.2)?

Answer:

Step 1: Old shares (3:2:1 = 3/6:2/6:1/6).
Step 2: Outgoing share (1/6), acq 3:2 = 3/5 & 2/5 of 1/6 = 3/30:2/30? 9/30:6/30.
Step 3: Add to remaining: Har 2/6=10/30 +9/30=19/30; Shreya 1/6=5/30 +6/30=11/30.
Step 4: Ratio 19:11.
Step 5: Gaining 3:2.
Step 6: Use for future.

Visual: Old bar → Split acq → Add bars. Example: Alka ret, Har:Shreya gain.

Question 2: Steps for gaining ratio (Ill.5)?

Answer:

Step 1: Old ratio 4:3:2 = 36/90:27/90:18/90? 9 denom.
Step 2: New 5:3 = 5/8:3/8 = 45/72:27/72.
Step 3: Sadhna 45/72 - 3/9=24/72 =21/72.
Step 4: Kamana 27/72 - 2/9=16/72 =11/72.
Step 5: 21:11.
Step 6: For GW debit.

Visual: New line - Old line = Gain segments. Example: Ranjana ret, new 5:3.

Question 3: Process for GW adjustment (Ill.6)?

Answer:

Step 1: Value GW 72k, share 3/9=24k.
Step 2: Calc gaining: Keshav 5/8-4/9=13/72; Pankaj 3/8-2/9=11/72.
Step 3: Ratio 13:11 of 24k =13k:11k.
Step 4: Dr Keshav Cap 13k, Pankaj 11k.
Step 5: Cr Nirmal 24k.
Step 6: Capitals adjust.

Visual: GW pie → Out slice → Gain split. Example: Nirmal ret, new 5:3.

Question 4: How to ascertain amount due?

Answer:

Step 1: Gather credits: Cap bal, current cr, GW, reserves, reval gain, profits date, int cap, salary.
Step 2: Debits: Current dr, GW off, losses, reval loss, losses date, drawings, int draw.
Step 3: Net = Due.
Step 4: Death: To executors.
Step 5: Verify adjustments done.
Step 6: Settle mode.

Visual: + Column - Column = Net box. Example: Incl GW from ratios.

Question 5: Steps for reval/unrecorded?

Answer:

Step 1: List changes: Assets up Dr, Liab up Cr.
Step 2: Reval A/c: Net gain/loss.
Step 3: Dist old ratio to all caps (incl outgoing).
Step 4: Unrec: Dr Asset Cr Reval (gain side).
Step 5: Close Reval to caps.
Step 6: Impact due.

Visual: A/L adjust → Reval temp → Dist arrows. Example: Hidden goodwill unrec.

Question 6: Process for settlement/loan?

Answer:

Step 1: Calc net due.
Step 2: If cash: Dr Out Cap Cr Bank.
Step 3: If loan: Dr Out Cap Cr Ret Loan.
Step 4: Int on loan 6% Dr Int Cr Loan.
Step 5: Death: Dr Cap Cr Executor.
Step 6: New BS without outgoing.

Visual: Due → Branch: Cash/Loan/Exec. Example: Deferred pay.

Tip: Treat as FAQ; apply to Ill. Easy: Q → Steps + Visual. Full Q&A for exam-like practice.

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