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

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 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 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. 

Marks-6, CBSE:2022-23/Zone-3/Set-1/Q-24*

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