0

X, Y and Z are equal partners with capitals of ₹ 15,000; ₹ 17,500 and ₹ 20,000 respectively. They agree to admit W into equal partnership upon payment in cash ₹ 15,000 for 1/4th share of the goodwill and ₹ 18,000 as his capital, both sums to remain in the business. The liabilities of the old firm were ₹ 30,000 and the assets, apart from cash, consist of Motors ₹ 12,000, Furniture ₹ 4,000, Stock ₹ 26,500 and Debtors ₹ 37,800. The Motors and Furniture were revalued at ₹ 9,500 and ₹ 3,800 respectively.

Pass Journal entries to give effect to the above arrangement and also show Balance Sheet of the new firm.

Anurag Pathak Changed status to publish May 23, 2023
Add a Comment