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Joint venture Accounts

Problem # 1
In the books of Pankaj Joint venture A/c Amount Particulars 10000 By Dinesh's A/c -Sales

Particulars To Cash/bank A/c (goods purchased) To Cash/bank A/c - Exps To Bank draft A/c - discount To Dinesh's A/c - Exps.

Amount 18000

1000 200 1200

Profit (1:1) To P & L A/c - pankaj's share - 2800 To Dinesh's A/c - Dinesh's Share -2800

5600 18000

18000

Particulars To Joint venture A/c - sales

Dinesh's A/c Amount Particulars 18000 By Bank draft A/c By joint venture A/c -exp By Joint venture A/c - profit By Bank A/c 18000

Amount 8000 1200 2800 6000 18000

Particulars To Pankaj's A/c (goods purchased) To Pankaj's A/c - Exps To Pankaj's A/c - discount To Cash/bank A/c - Exps. Profit (1:1) To Pankaj's A/c - pankaj's share -2800 To P & L A/c - Dinesh's Share 2800

In the books of Dinesh Joint venture A/c Amount Particulars 10000 By Cash/bank A/c -Sales

Amount 18000

1000 200 1200

5600 18000

18000

Particulars To Bank draft A/c

Pankaj's A/c Amount Particulars 8000 By Joint venture A/c (goods purchased) By Joint venture A/c - exps By joint venture A/c - disc. By joint venture A/c - profit

Amount 10000

1000 200 2800 14000

To Bank A/c

6000 14000

Problem # 2
In the books of Hathi Joint venture A/c Amount Particulars 187500 By Cash/bank A/c -Sales By Mankad's A/c - sales To Bills receivables A/c - discount To Cash/bank A/c - Hathi's Exps Carriage - 1500 Travelling Exps. - 1625 To Mankad's A/c - Mankad's Exps Carriage - 500 Travelling Exps. - 1500 To Commission A/c - Hathi's commi. (107500 x 5%) To Mankad's A/c - Mankad's commi. (117500 x 5%) Profit (3:2) To P & L A/c - Hathi's share 24900 To Mankad's A/c - Mankad's Share - 16600 1500 By Purchases A/c (unsold units purchased) 3125 (working note # 1) 21875

Particulars To Cash/bank A/c (goods purchased)

Amount 107500 117500

2000 5375 5875

41500 246875

246875

Particulars To Joint venture A/c - sales

Mankad's A/c Amount Particulars 117500 By Bills receivables A/c By joint venture A/c -exp By Joint venture A/c - comm. By Joint venture A/c - profit By Bank A/c

Amount 125000 2000 5875 16600 5875 149475

To Bank A/c

31975 149475

Particulars To Hathi's A/c (goods purchased) To Hathi's A/c - discount

In the books of Mankad Joint venture A/c Amount Particulars 187500 By Hathi's A/c -Sales By Cash/bank A/c - sales 1500 By Hathi's A/c (unsold units purchased) 3125 (working note # 1)

Amount 107500 117500

To Hathi's A/c - Hathi's Exps Carriage - 1500 Travelling Exps. - 1625 To Cash/bank A/c - Mankad's Exps Carriage - 500 Travelling Exps. - 1500 To Hathi's A/c - Hathi's commi. (107500 x 5%) To Commission A/c - Mankad's commi. (117500 x 5%) Profit (3:2) To Hathi's A/c - Hathi's share - 24900 To P & L A/c - Mankad's Share - 16600

21875

2000 5375 5875

41500 246875

246875

Working note # 1 Cost of goods sold = goods purchased closing stock = 187500-18750 = 168750 Gross Profit = Sales cost of goods sold = 225000-187500 = 56250 Gross profit rate on cost price = 56250/168750 x 100 = 331/3% Goods taken over by Hathi at half of the gross profit rate on cost price = 33.33/2 = 16.66667% Price at which closing stock taken over by Hathi = closing stock 18750 + profit (18750 x 16.6667%) = 21875

Hathi's A/c Particulars To Joint venture A/c To Bills payables A/c To joint venture A/c (unsold units purchased) Amount Particulars 107500 By Joint venture A/c (goods purchased) 125000 By Joint venture A/c - disc. 21875 By Joint venture A/c - exps By joint venture A/c - Commi By joint venture A/c - profit By Bank A/c 254375 Amount 187500

1500 3125 5375 24900 31975 254375

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Problem # 3
In the books of the firm Joint venture A/c Amount Particulars By Kirit's A/c - Material took away By Nilesh's A/c - Mixture machine
took away

Particulars To Joint bank A/c - Exps. Wages - 390000 Material - 610000 Plant - 40000 To Kirit's A/c - Architect fee paid To Nilesh's A/c - Mixture machine
brought

Amount 25000 20000 30000 10000

By Rajesh's A/c - Vehicle took away 1040000 By Joint bank A/c - plant realised 30000 55000 40000 Contract Price By Joint bank A/c - bank draft received By 12% Debenture A/c - debenture 60000 recd.

To Rajesh's A/c - Vehicle brought

900000 300000

To 12 % Debentures A/c - loss Profit (3:2:1) To Kirit's A/c To Nilesh's A/c To Rajesh's A/c -

30000 20000 10000

60000 1285000

1285000

Particulars By Joint venture A/c Architect fee By Joint venture A/c Mixture machine By Joint venture A/c Vehicle

Kirit 25000

Co-venturer's A/c Nilesh Rajesh Particulars By Joint Bank A/c 20000 By Joint venture A/c 30000 Architect fee By Joint venture A/c Mixture mach By Joint venture A/c Vehicle By Joint venture A/c profit

Kirit

Nilesh

Rajesh 90000

270000 180000

30000 55000 40000

By 12 % Debentures A/c

240000

30000

20000

10000 140000

To Joint Bank A/c

65000 235000 110000 330000 255000 140000

330000 255000

Joint Bank A/c Particulars To Kirit's A/c To Nilesh's A/c To Rajesh's A/c To Joint venture A/c - contract price To joint venture A/c - plant realized Amount Particulars 270000 To Joint venture A/c - Exps. 180000 Wages - 390000 90000 Material - 610000 Plant - 40000 900000 By kirit's A/c 10000 By Nilesh's A/c by Rajesh's A/c 1450000 Amount

1040000 65000 235000 110000 1450000

12% Debentures A/c Particulars To Joint Venture A/c Part of contract price Amount Particulars 300000 By Kirit's A/c - taken over By Joint venture A/c - loss 300000 Amount 240000 60000 300000

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