X and Y are partners in a firm sharing profits and losses in the ratio of 5 : 3. On 31st March, 2024, their Balance Sheet was as under:
X and Y are partners in a firm sharing profits and losses in the ratio of 5 : 3. On 31st March, 2024, their Balance Sheet was as under:
Balance Sheet as at 31st March
| Liabilities | ₹ | Assets | ₹ |
| Creditors | 50,000 | Bank | 29,000 |
| Workmen’s Compensation Reserve | 40,000 | Debtors | 1,80,000 |
| Capitals A/cs: X Y | 2,60,000 1,35,000 | Stock | 1,25,000 |
| Â | Â | Premises | 1,50,000 |
| Â | Â | Advertisement Expenses | 16,000 |
| Â | 5,00,000 | Â | 5,00,000 |
On 1st April, 2024, Z is admitted as a partner. X surrenders 1/4th of his share and Y 1/3rd of his share in favour of Z. Goodwill is valued at ₹ 1,60,000. Z brings in only 2/5th of his share of goodwill in cash and ₹ 1,50,000 as his capital. Following terms are agreed upon:
(I) Premises is to be increased to ₹ 2,00,000 and stock by ₹ 5,000.
(ii) Creditors proved at ₹ 60,000, one bill for goods purchased having been omitted from the books.
(iii) Outstanding rent amounted to ₹ 12,000 and prepaid salaries ₹ 2,000.
(iv) Liability on account of provident fund was only ₹ 10,000.
(v) Liability for Workmen’s Compensation Claim was ₹ 16,000.
Prepare Revaluation A/c, Capital A/cs and the opening Balance Sheet. Also Calculate the new profit sharing ratios.
[Ans. Gain on Revaluation ₹ 40,000; Z’s Current A/c (Dr.) ₹ 27,000; Capital A/cs X ₹ 3,15,000; Y ₹ 1,73,000 and Z ₹ 1,50,000; B/S Total ₹ 7,36,000; Sacrificing Ratio 5 : 4; New Ratios 15 : 8 : 9.]
Anurag Pathak Answered question August 31, 2024
