On 31st March, 2022 the Balance Sheet of partners 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, 2022
|Creditors||30,000||Cash at Bank||20,000|
|Investment Fluctuation Fund||12,000||Debtors 85,000|
|General Reserve||25,000||Less: Provision 5,000||80,000|
On 1st April 2022, 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) One-month salary ₹2,000 was outstanding.
(iii) The market value of investments was ₹50,000.
(iv) A debtor, whose dues were written off as bad debts, paid ₹12,000 in full settlement.
Prepare Revaluation Account and Partners Capital Accounts.