Madhu and Amar are
partners in a firm sharing profits and losses in the proportion of 3/5 and 2/5
respectively. Their Balance Sheet as on 31st March, 2012 was as follows:
Balance sheet as on
31.03.2012
|
Liabilities
|
Rs.
|
Assets
|
Rs.
|
|
Madhu's
Capital
|
35000
|
Sundry
Debtors
|
45000
|
|
Amar's
Capital
|
35000
|
Land
and Building
|
25000
|
|
Sundry
Creditors
|
62000
|
Stock
|
20500
|
|
|
|
Cash
at Bank
|
5000
|
|
|
|
Plant
and Machinery
|
35000
|
|
|
|
furniture
and Fixtures
|
1500
|
|
|
132000
|
|
132000
|
They have admitted
Vasant into Partnership. the terms being
that:
1. He shall pay Rs. 5000 as his share of goodwill,
the amount of goodwill retained into business.
2. He shall bring Rs. 15000 as his capital for ¼
share in future profits.
3. For the purpose of Vasant's admission, it was
agreed that the assets would be revalued as follows:
a. Land and Building to be taken at Rs. 30,000.
b. Plant and Machinery to be valued at Rs. 32000.
c. A provision of 5% on debtors would be made
against doubtful debts.
d. The value of stock at Rs. 25000.
Prepare Profit and Loss
Adjustment Account. Partners Capital Account and Balance Sheet of the new firm.
Ans. Profit and Loss
Adjustment A/c: Profit = 4250
Balance Sheet Total =
156250
Bank A/c Bal. = 25000
Capital A/c : Madhu =
Rs. 40,550
Amar = 38700
Vasant = 15000