Q88.
A and B were partners in a firm sharing profits in 3 : 1 ratio. They admitted C as a partner for 1/4th share in the future profits. C was to bring 60,000 for his capital. The Balance Sheet of
A and B as at 1st April, 2019, the date on which C was admitted, was:
|
Liabilities
|
|
Assets
|
|
|
|
Capital A/cs:
A B
General Reserve Creditors
|
50,000
80,000
|
1,30,000
10,000
70,000
|
Land and Building Plant ad Machinery Stock
Debtors
Less: Provision for Doubtful Debts Investments
Cash
|
35,000
1,000
|
40,000
70,000
30,000
34,000
26,000
10,000
|
|
|
|
|
|
|
|
|
2,10,000
|
2,10,000
|
|
|
|
|
|
The other terms agreed upon were:
- Goodwill of the firm was valued at 24,000.
- Land and Building were valued at 65,000 and Plant and Machinery at 60,000. (c) Provision for Doubtful Debts was found in excess by 400.
- A liability of 1,200 included in Sundry Creditors was not likely to arise.
- The capitals of the partners be adjusted on the basis of C's contribution of capital to the firm.
- Excess of shortfall, if any, be transferred to Current Accounts.
Prepare Revaluation Account, Partners' Capital Accounts and Balance Sheet of the new firm.