Ashish and Vishesh were partners sharing profits and losses in the ratio of 3:2. Their Balance Sheet as at 31st March, 2022 was as under:

Balance Sheet of Ashish and Vishesh as at 31st March, 2022

Liabilities Amount
Assets Amount
Creditors 30,000 Cash at Bank 50,000
Outstanding Electricity Bill 20,000 Debtors 80,000
Capitals: Less: Provision for
Bad Debts 2,000

Ashish 3,00,000 Stock 1,12,000
Vishesh 2,00,000 5,00,000 Machinery 3,00,000
Profit and Loss A/c 10,000
5,50,000 5,50,000

On 1st April, 2022, Manya was admitted into the firm with 1/4th share in the profits on the following terms:


  1. Manya will bring 1,00,000 as her capital and 50,000 as her share of goodwill premium in cash.
  2. Outstanding electricity bill will be paid off.
  3. Stock was found over valued by 12,000.


Pass the necessary journal entries in the books of the firm on Manya’s admission. 

Marks-6, CBSE:2022-23/Zone-5/Set-1/Q-24*

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