On 31st March 2017, the Balance Sheet of Abhir and Divya, who were sharing profits in the ratio of 3 : 1 was as follows :
Balance Sheet of Abhir and Divya as on 31st March 2017
Liabilities | Amount (Rs.) | Assets | Amount (Rs.) |
Creditors | 2,20,000 | Cash at Bank | 1,40,000 |
Employees’ Provident Fund | 1,00,000 | Debtors 6,50,000 | |
Investment Fluctuation Fund | 1,00,000 | Less:- Provision for bad debts (50,000) | 6,00,000 |
General Reserve | 1,20,000 | Stock | 3,00,000 |
Capitals : | Investments (market value Rs. 4,40,000) | 5,00,000 | |
Abhir : 6,00,000 | |||
Divya : 4,00,000 | 10,00,000 | ||
Total | 15,40,000 | Total | 15,40,000 |
They decided to admit Vibhor on April 1, 2017 for 1/5th share.
(a) Vibhor shall bring Rs. 80,000 as his share of goodwill premium.
(b) Stock was overvalued by Rs. 20,000.
(c) A debtors whose dues of Rs. 5,000 were written off as bad debts, paid Rs. 4,000 in full settlement.
(d) Two months salary @ Rs. 6,000 per month was outstanding.
(e) Vibhor was to bring in Capital to the extent of 1/5th of the total capital of the new firm.
Prepare Revaluation A/c, Partners’ Capital A/c and the Balance Sheet of the reconstituted firm.
Marks-8, CBSE:2017-18/Comp/Q-17*
Answer :