X, Y and Z were partners in a firm sharing profits and losses in the ratio of 3 : 3 : 4. On 31st March, 2022 their Balance Sheet was as follows:

Balance Sheet of X, Y and Z as at 31st March, 2022

Liabilities Amount
Assets Amount
Sundry Creditors 34,000 Bank 1,74,000
Bills Payable 29,000 Sundry Debtors 2,00,000
General Reserve 2,00,000 Bills Receivable 26,000
Capitals : Stock 1,50,000
X      3,00,000 Furniture 1,28,000
Y      3,00,000 Machinery 2,00,000
Z      4,00,000 10,00,000 Land and Building 3,85,000
Total 12,63,000 Total 12,63,000

On the above date, Z retired on the following terms:

(i) A provision of 3% on debtors will be created for bad and doubtful debts.

(ii) Stock will be reduced by 5,000 and furniture by 2,000.

(iii) Land and building will be brought up to 4,00,000 and machinery will be brought down to 1,80,000.


Prepare Revaluation Account and Z s Capital Account, transferring the amount due to his loan account. 

Marks-5, CBSE:2021-22/Term-2/Zone-4/Set-1/Q-8*

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