Madhav and Girdhuri were partners in a firm sharing profits and Losses in the ratio of 3:1. Their balance sheet as at 31 March, 2022 was as follows

Balance sheet of Madhav and Girdhari as on 31 March, 2022

Liabilities Amount
Assets Amount
Capitals: Machinery 4,70,000
Madhav            3,00,000 Investment 1,10,000
Girdhari            2,00,000 5,00,000 Debtors            1,20,000
Workmen’s Compensation Fund
Less: Provision for
Doubtful debts            10,000

Creditors 1,90,000 Stock 1,40,000
Employee’s Provident Fund 1,10,000 Cash 30,000
8,60,000 8,60,000

On 1st April, 2022, they admitted Jyoti into partnership for l/4th share in the profits of the firm. Jyoti brought ₹1,86,000 as her capital and ₹40,000 as her share of goodwill premium in cash. The following terms were agreed upon:

(i) Stock was found undervalued by ₹23,000,

(ii) 20% of the investments were taken over by Girdhari at book value.

(iii) Claim on account of workmen’s compensation amounted to ₹70,000, which was to be paid later.

(iv) Creditors included a sum of ₹27,000 which was not likely to be claimed.

Prepare Revaluation A/c and Partners’ Capital Accounts on Jyoti’s admission,

Marks-6, CBSE:2022-23/Zone-2/Set-1/Q-26*

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