Kalpana and Kanika are partners in a firm sharing profits in the ratio of 3 : 2. Their Balance Sheet as at 31st March, 2023 was as follows:
Kalpana and Kanika are partners in a firm sharing profits in the ratio of 3 : 2. Their Balance Sheet as at 31st March, 2023 was as follows:
| Liabilities | ₹ | Assets | ₹ |
| Outstanding Rent
Creditors Workmen Compensation Reserve Capital A/cs: Kalpana Kanika |
13,000 20,000 5,600 50,000 60,000 |
Cash
Sundry Debtors Stock Profit & Loss A/c Machinery |
10,000 76,000 20,000 4,000 38,600 |
| 1,48,600 | 1,48,600 |
On 1st April, 2023, they admitted Pran as a partner for 1/6th share on the following terms:
(i) Pran will bring ₹ 40,000 as his share of Capital but he is unable to bring any amount for Goodwill.
(ii) Claim on account of Workmen Compensation is ₹ 3,000.
(iii) To write off Bad Debts amounting to ₹ 6,000.
(iv) Creditors are to be paid ₹ 2,000 more.
(v) There being a claim against the firm for damages, liability of ₹ 2,000 to be created.
(vi) Outstanding Rent be brought down to ₹ 11,200.
(vii) Goodwill is valued at 1 and half years purchase of the average profits of last 3 years, less ₹ 12,000. Profits for the last 3 financial years amounted to ₹ 10,000; ₹ 20,000 and ₹ 30,000.
Pass Journal entries, Prepare Capital Accounts and opening Balance Sheet of the new firm.
Anurag Pathak Changed status to publish July 15, 2023
