X and Y are partners sharing profits in the ratio of 2 : 1. Their Balance Sheet as at 31st March, 2023 was:
X and Y are partners sharing profits in the ratio of 2 : 1. Their Balance Sheet as at 31st March, 2023 was:
| Liabilities | ₹ | Assets | ₹ |
| Sundry Creditors
General Reserve Capital A/cs: X Y |
25,000 18,000 75,000 62,000 |
Cash/Bank
Sundry Debtors Stock Investments Printer Fixed Assets |
5,000 15,000 10,000 8,000 5,000 1,37,000 |
| 1,80,000 | 1,80,000 |
They admit Z into partnership on 1st April, 2023 on the following terms:
a) Z brings in ₹ 40,000 as his capital and he is given 1/4th share in profits.
b) Z brings in ₹ 15,000 for goodwill, half of which is withdrawn by old partners.
c) Investments are valued at ₹ 10,000. X takes over Investments at this value.
d) Printer is to be reduced (depreciated) by 20% and Fixed Assets by 10%.
e) An unrecorded stock on 31st March, 2023 is ₹ 1,000.
f) By bringing in or withdrawn cash, the Capitals of X and Y are to be made proportionate to that of Z on their profit sharing ratio.
Pass Journal entries, prepare Revaluation Account, Capital Accounts and new Balance Sheet of the firm.
Anurag Pathak Changed status to publish May 28, 2023
