On 31st March, 2019 the Balance Sheet of Madan and Mohan who share profits and losses in the ratio of 3 : 2 was as follows:
On 31st March, 2019 the Balance Sheet of Madan and Mohan who share profits and losses in the ratio of 3 : 2 was as follows:
Balance Sheet of Madan and Mohan as at 31st March, 2019
| Liabilities | ₹ | Assets | ₹ |
| Creditors | 28,000 | Cash at Bank | 10,000 |
| General Reserve | 10,000 |
Debtors 65,000 Less: Provision 5,000 |
60,000 |
| Employees Provident Fund | 22,000 | Stock | 33,000 |
|
Captials: Madan Mohan |
60,000 40,000 | Patents | 57,000 |
| Â | 1,60,000 | Â | 1,60,000 |
They decided to admit Gopal on 1st April, 2019 for 1/5th share which Gopal acquired wholly from Mohan on the following terms:
(i) Gopal shall bring ₹ 10,000 as his share of premium for Goodwill.
(ii) A debtor whose dues of ₹ 3,000 were written off as bad debt paid ₹ 2,000 in full settlement.
(iii) A claim of ₹ 5,000 on account of workmen’s compensation was to be provided for.
(iv) Patents were undervalued by ₹ 2,000. Stock in the books was valued 10% more than its market value.
(v) Gopal was to bring in capital equal to 20% of the combined capitals of Madan and Mohan after all adjustments.
Prepare Revaluation Account, Capital Accounts of the partners and th Balance Sheet of the new firm.
[Ans. Loss on Revaluation ₹ 4,000; Capitals : Madan ₹ 63,600; Mohan ₹ 52,400 and Gopal ₹ 23,200; Bank Balance ₹ 45,200; Balance Sheet Total ₹ 1,94,200.]
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