On 31st March, 2019 the Balance Sheet of A and B, who were sharing profits in the ratio of 3 : 2 was as follows :
Balance Sheet of A and B as at 31st March, 2019
| Liabilities | Amount ₹ | Assets | Amount ₹ |
|---|---|---|---|
| Creditors | 30,000 | Cash at Bank | 20,000 |
| Investment Fluctuation Fund | 12,000 | Debtors 85,000 | |
| General Reserve | 25,000 | Less: Provision for bad debts 5,000 |
80,000 |
| Capitals : | Stock | 1,30,000 | |
| A 1,60,000 | Investments | 60,000 | |
| B 1,40,000 | 3,00,000 | Furniture | 77,000 |
| 3,67,000 | 3,67,000 |
On 1st April, 2019, they decided to admit C as a new partner for 1/5th share in the profits on the following terms:
(i) C brought ₹1,00,000 as his capital and ₹50,000 as his share of premium for goodwill.
(ii) Outstanding salaries of ₹2,000 be provided for.
(iii) The market value of investments was ₹50,000.
(iv) A debtor whose dues of ₹18,000 were written off as bad debts paid ₹12,000 in full settlement.
Prepare Revaluation Account, Partners’ Capital Accounts and the Balance Sheet of the new firm.
Marks-8, CBSE:2019-20/Compartment/Q-22*
Answer :