Kanika, Disha and Kabir were partners sharing profits in the ratio of 2 : 1 : 1. On 31-3-2016, their Balance Sheet was as under :
Liabilities | Amount (Rs.) | Assets | Amount (Rs.) |
Trade creditors | 53,000 | Bank | 60,000 |
Employees’ Provident Fund | 47,000 | Debtors | 60,000 |
Kanika’s capital | 2,00,000 | Stock | 1,00,000 |
Disha’s capital | 1,00,000 | Fixed assets | 2,40,000 |
Kabir’s capital | 80,000 | Profit & Loss A/c. | 20,000 |
Total | 4,80,000 | Total | 4,80,000 |
Kanika retired on 1-4-2016. For this purpose, the following adjustments were agreed upon :
(a) Goodwill of the firm was valued at 2 years’ purchase of average profits of three completed years preceding the date of retirement. The profits for the year :
2013-14 were Rs. 1,00,000 and for 2014-15 were Rs. 1,30,000.
(b) Fixed assets were to be increased to Rs. 3,00,000.
(c) Stock was to be valued at 120%.
(d) The amount payable to Kanika was transferred to her loan account.
Prepare Revaluation Account, Capital Accounts of the partners and the Balance Sheet of the reconstituted firm.
Marks-8, CBSE:2016-17/Comp-AI/Q-17*
Answer :