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Q: Ram and Gautham entered into a joint venture to buy and sell TV sets, on 1st July, 2011. On 1.7.2011, Ram sent a draft for Rs.2,50,000 in favour of Gautham, and on 4.7.2011, the latter purchased 200 sets each at a cost of Rs.2,000 each. The sets were sent to Ram by lorry under freight “to pay” for Rs.2,000 and were cleared by Ram on 15.7.2011.
Ram effected sales in the following manner:
No. of Sets
On 25.8.2011, Ram settled the account by sending a draft in favour of Gautham, profits being shared equally. Gautham does not maintain any books. Show in Ram’s book:
(i) Joint Venture with Gautham A/c; and
(ii) Memorandum Joint Venture A/c.