Krish, Vrish and Peter are partners sharing profits in the ratio of 3:2:1. Vrish retired from the firm. On that date the Balance Sheet of the firm was as follows:

Balance Sheet as on March 31, 2020

Liabilities Amount
(₹)
Assets Amount
(₹)
Creditors
General Reserve
Bills Payable
Outstanding Salary
Provision for Legal Damages
Capitals:
Krish
Vrish
Peter






15,000
12,000
12,000
2,200
6,000
46,000
30,000
20,000
Bank
Furniture
Stock
Premises
Debtors
Less: Provision for Doubtful Debts




6,000
400
7,600
41,000
9,000
80,000

5,600
1,43,200 1,43,200

Additional Information: 

  • Premises to be appreciated by 20%, Stock to be depreciated by 10% and Provision for doubtful debts was to be maintained @5% on Debtors. Further, provision for legal damages is to be increased by 1,200 and furniture to be brought up to 45,000. 
  • Goodwill of the firm is valued at 42,000. 
  • 26,000 from Vrish’s Capital account be transferred to his loan account and balance to be paid through bank; if required, necessary loan may be obtained from bank. 
  • New profit sharing ratio of Krish and Peter is decided to be 5:1. 

 

Prepare Revaluation Account, Partners Capital Accounts and Balance Sheet. 

Marks-8, CBSE:2020-21/Sample/Q-21*

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