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Question
J, H and K were partners in a firm sharing profits in the ratio of 5:3:2. On 31-3-2015 their Balance Sheet was as follows:
Balance Sheet of J,H and K as on 31-3-2015
| LIabilities | Amount(Rs.) | Assets | Amount(Rs.) |
|
Creditors Investment Fluctuation Fund P & L Account Capital: J 1,00,000 H 80,000 K 40,000
|
42,000 20,000 80,000
2,20,000
|
Land and Building Motor Vans Investments Machinery Stock Debtors 80,000 Less: 6,000 Cash |
2,24,000 40,000 38,000 24,000 30,000
74,000 32,000 |
| 3,62,000 | 3,62,000 |
On the above data H retires and J and K agreed to continue the business on the following terms:
(i) Goodwill of the firm was valued at Rs.1,02,000.
(ii) There was a claim of Rs.8,000 for workmen's compensation.
(iii) Provision for bad debts was to be reduced by Rs.2,000.
(iv) H will be paid Rs.14,000 in cash and the balance will be transferred in his loan account which will be paid in four equal yearly installments together with interest @ 10% p.a.
(v) The new profit sharing ratio between J and K will be 3:2 and their capitals will be in their new profit sharing ratio. The capital adjustments will be done by opening current accounts.
Prepare Revaluation Account, Partner’s Capital Accounts and Balance Sheet of the new firm.
Solution
Revaluation Account
Dr. Cr.
| Particulars | Amount(Rs.) | Particulars | Amount(Rs.) |
|
To Claim for Workman Compensation
|
8,000
|
By Provision for Doubtful Debts
By Loss on Revaluation J’s Capital A/c 3,000 H’s Capital A/c 1,800 K’s Capital A/c 1,200
|
2,000
6,000
|
| 8,000 | 8,000 |
Partner’s Capital Account
Dr. Cr.
| Particulars | J (Rs.) | H (Rs.) | K (Rs.) | Particulars | J (Rs.) | H (Rs.) | K (Rs.) |
|
Revaluation A/c H’s Capital A/c Cash A/c H’s Loan A/c
Balance c/d |
3,000 10,200
1,36,800 |
1,800
14,000 1,24,800
|
1,200 20,400
38,400 |
Balance b/d IFF P&L A/c J’s Capital K’s Capital
|
1,00,000 10,000 40,000
|
80,000 6,000 24,000 10,200 20,400
|
40,000 4,000 16,000
|
| 1,50,000 | 1,40,600 | 60,000 | 1,50,000 | 1,40,600 | 60,000 | ||
|
Current A/c
Balance c/d |
31,680
1,05,120 |
70,080 |
Balance b/d Current A/c
|
1,36,800
|
38,400 31,680
|
||
| 1,36,800 | 70,080 | 1,36,800 | 70,080 |
Balance Sheet as on March 31,2015
| Liabilities | Amount (Rs.) | Assets | Amount (Rs.) |
|
Creditors Capitals J 1,05,120 H 70,080 J’s Current A/c Claim for Workmen Compensation H’s Loan A/c
|
42,000
1,75,200 31,680 8,000 1,24,800
|
Land and Building Motor Vans Investment Machinery Stock Debtors 80,000 Less: Provision 4,000 Cash (32,000 - 14,000) K’s Current A/c
|
1,24,000 40,000 38,000 24,000 30,000
76,000 18,000 31,680
|
| 3,81,680 | 3,81,680 |
Working Notes :
WN 1: Calculation of Gaining Ratio
J's = (3/5) - (5/10) = 1/10
K's = (2/5) - (2/10) = 2/10
Gaining Ratio = 1 : 2
WN 2: Adjustment of Goodwill
H's Share of Goodwill = 1,02,000 x (3/10) = 30,600
30,600 will be debited to gaining partners (J and K) in the ratio of 1:2
J's Share = 30,600 x (1/3) = 10,200
K's share = 30,600 x (2/3) = 20,400
WN 3: Adjustment of Capital
Adjusted Capital of J = 1,00,000 + 10,000 + 40,000 – 3,000 – 10,200 = 1,36,800
Adjusted Capital of K = 40,000 + 4,000 + 16,000 – 1,200 – 20,400 = 38,400
Total Adjusted Capital = 1,36,800 + 38,400 = 1,75,200
J's New Capital = 87,600 x (3/5) = 52,560
K's New Capital = 87,600 x (2/5) = 35,040
K’s New Capital > K’s Adjusted Capital (K owes 31,680 to the firm)
J’s New Capital < J’s Adjusted Capital (Firm owes 31,680 to J)
WN 4 Amount transferred to H’s Loan A/c
Amount to be transferred = (Credit side – Debit side) – Cash paid
= (1,40,600 – 1,800) – 14,000
= 1,24,800
APPEARS IN
RELATED QUESTIONS
R, S and T were partners in a firm sharing profit in the ratio of 1:2:3. On 31-3-2015 their Balance sheet was as follows :
Balance Sheet of A,B and C as on 31-3-2015
| Liabilities | Amount (Rs.) | Assets | Amount (Rs.) |
|
Creditors Bills Payable General Reserve Capitals R 1,00,000 S 50,000 T 25,000 |
50,000 20,000 30,000
1,75,000 |
Land Building Plant Stock Debtors Bank
|
50,000 50,000 1,00,000 40,000 30,000 5,000
|
| 2,75,000 | 2,75,000 |
R,S and T decided to share the profits equally with effects from 1.4.2015. For this it was agreed that:
(a) Goodwill of the firm will be valued at Rs.1,50,000
(b) Land will be revalued at Rs.80,000 and building be depreciated by 6%.
(c) Creditors of Rs.6,000 were not likely to be claimed and hence should be written off
Prepare Revaluations Account, Partner’s Capital Accounts and Balance Sheet of the reconstitute firm.
L, M and N were partners in a firm sharing profit in the ratio of 3:2:1. Their Balance Sheet on 31.3.2015 was as follows :
Balance Sheet of L,M and N as on 31-3-2015
| Liabilities | Amount(Rs.) | Assets | Amount(Rs.) |
|
Creditors General Reserve Capitals L 1,20,000 M 80,000 N 40,000
|
1,68,000 42,000
2,40,000
|
Bank Debtors Stock Investments Furniture Machinery
|
34,000 46,000 2,20,000 60,000 20,000 70,000
|
| 4,50,000 | 4,50,000 |
On the above date O was admitted as a new partner and it was decided that:
(i) The new profit sharing ratio between L, M, N and 0 will be 2: 2: 1: 1.
(ii) Goodwill of the firm was valued at Rs.1,80,000 and O brought his share of goodwill premium in cash.
(iii) The market value of investments was Rs.36,000.
(iv) Machinery will be reduced to Rs.58,000.
(v) A creditor of Rs.6,000 was not likely to claim the amount and hence to be written-off.
(vi) O will bring proportionate capital so as to give him 1/6th share in the profits of the firm.
Prepare Revaluation Account. Partner's Capital Accounts and the Balance Sheet of the New Firm
Kushal Kumar and Kavita were partners in a firm sharing profit in the ratio 3:1:1. On 1st April 2012 their Balance Sheet was as follows:
Balance Sheet of Kushal, Kumar and Kavita as on 1st April 2012
| Liabilities | Amount (Rs.) | Assets | Amount (Rs.) |
|
Creditors Bill payable General Reserve Capital: Kushi 3,00,000 Kumar 2,80,000 Kavita 3,00,000 |
1,20,000 1,80,000 1,20,000
8,80,000 |
Cash Debtors 2,00,000 Less: Provision 10,000 Stock Furniture Building Land |
70,000
1,90,000 2,20,000 1,20,000 3,00,000 4,00,000 |
| 13,00,000 | 13,00,000 |
On the above date, Kavita retired and the following was agreed:
i. Goodwill of the firm was valued at Rs.40,000.
ii. The land was to be appreciated by 30% and the building was to be depreciated by Rs.1,00,000.
iii. Value of furniture was to be reduced by Rs.20,000.
iv. Bad debts reserve is to be increased to Rs.15,000.
v. 10% of the amount payable to Kavita was paid in cash and the balance was transferred to her Loan Account.
vi. Capitals of Kushal and Kumar will be in proportion to their new profit sharing ratio. The surplus/deficit, if any in their Capital Accounts will be adjusted through Current Accounts.
Prepare Revaluation Account, Partners Capital Accounts and Balance Sheet of Kushal and Kumar after Kavita's retirement.
A, B and C were partners in a firm sharing profit in the ratio of 3:2:1. On 31-3-2015 their Balance sheet was as follows :
Balance Sheet of A,B and C as on 31-3-2015
| Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
Creditors Bills Payable
Capitals A 1,00,000 B 50,000 C 25,000 General Reserve |
50,000 20,000
1,75,000 30,000 |
Land Building Plant Stock Debtors Bank
|
50,000 50,000 1,00,000 40,000 30,000 5,000
|
| 2,75,000 | 2,75,000 |
On the above date D was admitted as new partner and it was decided that:
(i) Goodwill of the firm will be valued at 1,50,000
(ii) Land will be revalued at 80,000 and building be depreciated by 60%.
(iii) Creditors of 6,000 were not likely to be claimed and hence should be written off
Prepare Revaluations Account, Partner’s Capital Accounts and Balance Sheet of the reconstitute firm.
Charu and Harsha were partners in a firm sharing profits in the ratio of 3:2. On 1-4-2014 their Balance Sheet was as follows :
| Balance Sheet | |||
| Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
Creditors General Reserve Workmen Compensation Fund Investment Fluctuation Fund Provision for bad debts Capitals Charu 30,000 Harsha 20,000 |
17,000 4,000 9,000 11,000 2,000
50,000 |
Cash Debtors Investments Plant Land and building
|
6,000 15,000 20,000 14,000 38,000
|
| 93,000 | 93,000 | ||
On the above date, Vaishali was admitted for 1/4th share in the profits of the firm on the following terms:
(a) Vaishali will bring Rs 20,000 for her capital and Rs 4,000 for her share of goodwill premium.
(b) All debtors were considered good.
(c) The market value of investments was Rs 15,000.
(d) There was a liability of Rs 6,000 for workmen compensation.
(e) Capital accounts of Charu and Marsha are to be adjusted on the basis of Vaishali's capital by
opening current accounts.
Prepare Revaluation Account and Partners' Capital Accounts
Under which major headings the following items will be presented in the Balance sheet of a company as per Schedule VI Part I of the Companies Act, 1956?
(1) Loans provided repayable on demand
(2) Goodwill
(3) Copyrights
(4) Loose tools
(5) Cheques
(6) General Reserve
(7) A stock of finished goods and
(8) 9% Debentures repayable after three years
Xavier, Yusuf and Zaman were partners in a firm sharing profits in the ratio of 4:3: 2. On 1.4.2014 their Balance sheet was as follows:
| Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
Sundry Creditors Capital Accounts Xavier 1,20,000 Yusuf 90,000 Zaman 60,000
|
41,400
2,70,000
|
Cash at Bank Sundry Debtors 30,450 Less: Prov. For Bad debts 1,050 Stock Plant and Machinery Land and Building |
33,000
29,400 48,000 51,000 1,50,000 |
| 3,11,400 | 3,11,400 |
Yusuf had been suffering from ill health and thus gave notice of retirement from the firm. An agreement was, therefore, entered into as on 1.4.2014, the terms of which were as follows:
1) That land and building be appreciated by 10%
2) The provision for bad debts is no longer necessary
3) That stock be appreciated by 20%
4) That goodwill of the firm be fixed at Rs 54,000. Yusuf share of the same be adjusted into Xavier's and Zamna's Capital Accounts, who are going to share future profits in the ratio of 2:1
5) The entire capital of the newly constituted firm be readjusted by bringing in or paying necessary cash so that the future capitals of Xavier and Zaman will be in their profit sharing ratio.
Prepare Revaluation Account and Partner's Capital Account
Shikhar and Rohit were partners in a firm sharing profit in the ratio 7:3. On 1st April 2013, they admitted Kavi as a new partner for a ¼ share in the profit of the firm. Kavi brought Rs 4,30,000 as his capital and Rs 25,000 for his share of goodwill premium. The Balance Sheet of Shikhar and Rohit as on 1st April 2013 was as follows:
| Balance Sheet of Shikhar and Rohit as on 1st April 2013 | |||
| Liabilities | Rs | Assets | Rs |
|
Capital: Shikhar 8,00,000 Rohit 3,50,000 General Reserve Workman’s Compensation Fund Creditors |
11,50,000 1,00,000 1,00,000 1,50,000 |
Land and Building Machinery Debtors 2,20,000 Less: Provision 20,000 Stock Cash |
3,50,000 4,50,000
2,00,000 3,50,000 1,50,000 |
| 15,00,000 | 15,00,000 | ||
It was agreed that:
1. The value of Land and Building will be appreciated by 20%.
2. The value of Machinery will be depreciated by 10%.
3. The liabilities of Workmen's Compensation Fund was determined at Rs 50,000.
4. Capitals of Shikhar and Rohit will be adjusted on the basis of Kavi's capital and actual cash to be brought in or to be paid off as the case may be.
Prepare Revaluation Account, Partners' Capital Accounts and the Balance Sheet of the new firm.
L, M and N were partners in firm sharing profits in the ratio of 2:1:1. On 15' April 2013 their Balance Sheet as follows:
| Balance Sheet of L, M and N as on 1st April 2013 |
|||
| Liabilities | Rs | Assets | Rs |
|
Capital: L 6,00,000 M 4,80,000 N 4,80,000 General Reserve Workman’s Compensation Fund Creditors
|
15,60,000 4,40,000 3,60,000 2,40,000
|
Land Building Furniture Debtors 4,00,000 Less: Provision 20,000 Stock Cash
|
8,00,000 6,00,000 2,40,000
3,80,000 4,40,000 1,40,000
|
| 26,00,000 | 26,00,000 | ||
On the above date, N retired
The following were agreed:
i. Goodwill of the firm was valued at Rs 6,00,000.
ii. The land was to be appreciated by 40% and Building was to be depreciated by Rs 1,00,000. Furniture was to be depreciated by Rs 30,000.
iii. The liabilities for Workmen's Compensation Fund was determined at Rs 1,60,000.
iv. The amount payable to N was transferred to his loan account.
v. Capitals of L and M were to be adjusted in their new profit sharing ratio and for this purpose current accounts of the partners will be opened.
Prepare Revaluation Account, Partners' Capital Accounts and the Balance Sheet of the new firm.
X, Y and Z were partners in a firm sharing profits in the ratio of 5 : 3 : 2. The firm closes its books on 31st March every year. On 30.9.2016, Z died. The partnership deed provided that on the death of a partner his executors will be entitled to the following :
(i) Balance in his capital account and interest @ 12% per annum. On 1.4.2016 balance in Z's Capital account was Rs 80,000.
(ii) His share in the profits of the firm in the year of his death, which will be calculated on the basis of rate of net profit on sales of the previous year which was 25%. The sales of the firm till 30.9.2016 were Rs 4,00,000.
(iii) His share on the goodwill of the firm. The goodwill of the firm on Z's death was valued at Rs 3,00,000.
The partnership deed also provided that the following deductions will be made from the amount payable to the executor of the deceased partner:
(i) His drawing in the year of his death. Z has withdrawn Rs 30,000 till 30.9.2016.
(ii) Interest on drawing @ 12% per annum which was calculated as Rs 2,000.
The accountant of the firm prepared Z's Capital Account to be presented to his executor but in a hurry did not complete it. Z's Capital Account as prepared by the firm's accountant is presented below :
|
Dr. |
Z’s Capital Account |
Cr. |
|||
|
Date |
Particulars |
Amount (Rs) |
Date |
Particulars |
Amount (Rs) |
|
2016 |
|
|
2016 |
|
|
|
Sep. 30 |
…………… |
30,000 |
April 1 |
…………… |
80,000 |
|
Sep. 30 |
…………… |
2,000 |
Sep. 30 |
…………… |
4,800 |
|
Sep. 30 |
…………… |
……... |
Sep. 30 |
…………… |
20,000 |
|
|
|
|
Sep. 30 |
…………… |
……... |
|
|
|
|
Sep. 30 |
…………… |
……... |
|
|
|
1,64,800 |
|
|
1,64,800 |
|
|
|
|
|
|
|
You are required to complete Z's Capital Account.
P, Q and R were partners in a firm sharing profit in the ratio of 7 : 2: 1. On 1st April, 2013 their Balance Sheet was as follows:
|
Balance Sheet of P, Q and R as on 1st April, 2013 |
|||||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
||
|
Capitals: |
|
Land |
12,00,000 |
||
|
P |
9,00,000 |
|
Building |
9,00,000 |
|
|
Q |
8,40,000 |
|
Furniture |
3,60,000 |
|
|
R |
9,00,000 |
26,40,000 |
Stock |
6,60,000 |
|
|
General Reserve |
3,60,000 |
Debtors |
6,00,000 |
|
|
|
Workmen’s Compensation Fund |
5,40,000 |
Less provision |
–30,000 |
5,70,000 |
|
|
Creditors |
3,60,000 |
Cash |
2,10,000 |
||
|
|
39,00,000 |
|
39,00,000 |
||
|
|
|
|
|||
On the above data Q retired.
The following were agreed:
(i) Goodwill of the firm was valued at Rs 12,00,000.
(ii) Land was to be appreciated by 30% and Building was to depreciated by 3,00,000.
(iii) Value of furniture was to be reduced by Rs 60,000.
(iv) The liabilities for Workmen's Compensation Fund were determined at Rs 1,40,000.
(v) Amount Payable to Q was transferred to his loan account.
(vi) Capitals of P and R were to be adjusted in their new profit sharing ratio, For this purpose current accounts of the partners will be opened.
Prepare Revaluation Account, Partner's Capital Accounts and the Balance Sheet of the new firm.
X, Y and Z were partners in a firm sharing profits and losses in the ratio of 5 : 3 : 2. On 31.3.2010 their Balance Sheet was as follows:
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
|
Capital Accounts: |
|
Building |
50,000 |
|
|
X |
75,000 |
|
Patents |
15,000 |
|
Y |
62,000 |
|
Machinery |
75,000 |
|
Z |
37,500 |
1,75,000 |
Stock |
37,500 |
|
Sundry Creditors |
42,500 |
Debtors |
20,000 |
|
|
|
|
Cash at Bank |
20,000 |
|
|
|
2,17,500 |
|
2,17,500 |
|
|
|
|
|
|
|
Z died on 31.7.2010. It was agreed that:
(a) Goodwill be valued at 2½ year’s purchased of the average profits of the last four year which were as follows:
|
Years |
Profit Rs |
|
2006 – 2007 |
32,500 |
|
2007 – 2008 |
30,000 |
|
2008 – 2009 |
40,000 |
|
2009 – 2010 |
37,500 |
(b) Machinery be valued at Rs 70,000; Patents at Rs 20,000 and Building at Rs 62,500.
(c) For the purpose of calculating Z’s share of profits on the year of his death the profit in 2010 − 2011 should be taken to have been accrued on the same scale as in 2009 − 2010.
(d) A sum of Rs 17,500 was paid immediately to the executors of Z the balance was paid in four half yearly installments together with interest at 12% p.a. starting from 31.1.2011.
Given necessary journal entries to record the above transaction and Z’s executor’s account till the payment of installments due on
31.1.2011
From the following Receipts and Payments Account of Kolkata Sports Club for the year ended
31.3.2011, prepare Income and Expenditure Account.
|
Receipts and Payments Account of Kolkat Sports Club for the year ended 31.3.2011 |
|||
|
Dr. |
|
|
Cr. |
|
Receipts |
Amount Rs |
Payments |
Amount Rs |
|
To Balance b/d |
3,200 |
By Salary |
1,800 |
|
To Subscription |
22,500 |
By Rent (paid on 30.9.2010 for 12 months) |
2,300 |
|
To Entrance Fees (including Rs 1,000 as capital income) |
3,000 |
By Electricity |
1,000 |
|
To Donations |
750 |
By Taxes |
2,200 |
|
To Rent of hall |
1,750 |
By Printing and Stationery |
400 |
|
To Accrued interest for the year 2009 – 2010 |
2,000 |
By Sundry Expenses |
900 |
|
|
|
By Books |
7,500 |
|
|
|
By 9% Fixed Deposit (on 1.4.2010) |
15,200 |
|
|
|
By Balance c/d |
1,900 |
|
|
33,200 |
|
33,200 |
|
|
|
|
|
The Balance Sheet of Ram and Shyam, who were sharing profits in the ratio of 3 : 1 on 31st March, 2009 was as follows:
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
||
|
Creditors |
2,800 |
Cash at bank |
2,000 |
||
|
Employees’ provident fund |
1,200 |
Debtors |
6,500 |
|
|
|
General Reserve |
2,000 |
Less: Reserve for bad debts |
(500) |
6,000 |
|
|
Capitals |
|
Stock |
3,000 |
||
|
Ram |
6,000 |
|
Investments |
5,000 |
|
|
Shyam |
4,000 |
10,000 |
|
|
|
|
|
16,000 |
|
16,000 |
||
|
|
|
|
|||
Susan, Geeta and Rashi are partners sharing profits and losses in the ratio of 5:3:2. Their Balance Sheet as at 31st March, 2017, is as under:
Balance Sheet of Susan, Geeta and Rashi As at 31st March, 2017
| Liabilities | Amount | Assets | Amount |
| Sundry Creditors | 50,000 | Cash at Bank | 70,000 |
| Workmen Compensation Reserve | 25,000 |
Sundry Debtor 65,000 Less Provision for Doubtful Debts (5,000 |
60,000 |
| Employees Provident Fund | 5,000 | Goodwill | 50,000 |
| Bank Loan | 55,000 | Furniture | 1,00,000 |
|
Capital A/C Susan 2,20,000 Geeta 1,70,000 Rashi 1,35,000 |
5,25,000 |
Building | 3,80,000 |
| 6,60,000 | 6,60,000 |
The partners decided to dissolve their partnership on 31st March, 2017. The following transactions took place at the time of dissolution :
(a) Realization expenses of 2,000 were paid by Susan on behalf of the firm.
(b) Geeta took over the goodwill for her own business at 40,000.
(c) Building was taken over by Rashi at 3,00,000.
(d) Only 80% of the debtors paid their dues.
(e) Furniture was sold for 97,000.
(f) Bank Loan was settled along with interest of 5,000. You are required to prepare the Realization Account.
Gita, Radha, and Garv were partners in firm sharing profits and losses in the ratio of 3: 5: 2. On 31st March 2019, their balance sheet was as follows:
Balance Sheet of Gita, Radha & Garv as on 31st March 2019
| Liabilities |
Amount (₹) |
Assets | Amount (₹) |
| Sundry Creditors |
60,000 |
Cash | 50,000 |
| General Reserve |
40,000 |
Stock | 80,000 |
| Capitals : |
|
Debtors | 40,000 |
| Gita - 3,00,000 |
|
Investments | 30,000 |
| Radha - 2,00,000 |
|
Buildings | 5,00,000 |
| Garv - 1,00,000 |
6,00,000 |
||
| 7,00,000 | 7,00,000 |
Radha retired on the above date and it was agreed that:
(a) Goodwill of the firm be valued at ₹ 3,00,000 and Radha's share be adjusted through the capital accounts of Gita and Gary.
(b) Stock was to be appreciated by 20%.
(c) Buildings were found undervalued by ₹ 1,00,000.
(d) Investments were sold for ₹ 34,000.
(e) Capital of the new firm was fixed at ₹ 5,00,000 which will be in the new profit sharing ratio of the partners; the necessary adjustments for this purpose were to be made by opening current accounts of the partners.
Prepare Revaluation Account, Partner's Capital Accounts, and the Balance Sheet of the reconstituted firm on Radha's retirement.
X and Y were partners in the profit-sharing ratio of 3 : 2. Their balance sheet as at March 31, 2022 was as follows:
| Balance Sheet as at March 31, 2022 | |||||
| Liabilities | Amount (₹) | Assets | Amount (₹) | ||
| Creditors | 56,000 | Plant and Machinery | 70,000 | ||
| General Reserve | 14,000 | Buildings | 98,000 | ||
| Capital Accounts: | Stock | 21,000 | |||
| X | 1,19,000 | 2,31,000 | Debtors | 42,000 | 35,000 |
| Y | 1,12,000 | (-) Provision | 7,000 | ||
| Cash in Hand | 77,000 | ||||
| 3,01,000 | 3,01,000 | ||||
Z was admitted for 1/6th share on the following terms:
- Z will bring ₹ 56,000 as his share of capital but was not able to bring any amount to compensate the sacrificing partners.
- Goodwill of the firm is valued at ₹. 84,000.
- Plant and Machinery were found to be undervalued by ₹ 14,000 Building was to be brought up to ₹ 1,09,000.
- All debtors are good.
- Capitals of X and Y will be adjusted on the basis of Z’s share and adjustments will be done by opening necessary current accounts.
You are required to prepare revaluation account and partners’ capital account.
On the date of admission of Ajay as a partner, the Balance Sheet of the firm of Nita and Rita showed a balance of ₹ 80,000 in the Workmen Compensation Reserve.
Choose the correct option to record the effect of a workmen compensation claim of ₹ 90,000 on the accounts of the partnership firm.
