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Balance Sheet of Manoj, Navin and Deep who were sharing the results in proportion to their capitals as at 31st March, 2023 is as under:

Liabilities Assets  

Bills Payable

Sundry Creditors

Capital A/cs:

Manoj

Navin

Deep

10,000

24,500

1,00,000

75,000

50,000

Bank Balance

Debtors

Less: PDD

Stock

Plant and Machinery

Factory

Building

 

25,000

500

27,500

24,500

40,000

42,500

1,25,000

  2,59,500     2,59,500

Navin retired on 1st April, 2023 and the following adjustments were made:

(i) Stock was reduced by 6%.

(ii) Factory Building was appreciated by 20%.

(iii) Provision for Doubtful Debts was created up to 5%.

(iv) Provision for legal charges to be made ₹ 3,850.

(v) Goodwill of the firm be fixed at ₹ 54,000.

(vi) Capital of the new firm be fixed at ₹ 1,40,000 in the profit and loss sharing ratio.

Prepare Revaluation Account, Capital Accounts and Balance Sheet of Manoj and Deep after transferring Navin’s Capital Account to his Loan Account.

Anurag Pathak Changed status to publish March 3, 2024
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