The following is the Balance Sheet of Shubha and Leena of Aurangabad who share profits in the ration 3:2 respectively as on 31.03.2012. Balance Sheet as on 31.03.2012

The following is the Balance Sheet of Shubha and Leena of Aurangabad who share profits in the ration 3:2 respectively as on 31.03.2012.
Balance Sheet as on 31.03.2012
Liabilities
Rs.
Assets
Rs.
Creditors
15000
Plant and Machinery
24000
General Reserve
11000
Stock
16000
Capital Accounts

Furniture
2000
Shubha
30000
Debtors
30000
Leena
20000
Cash at Bank
4000

76000

76000
They decided to admit Manjusha on 1st April, 2012 on the following terms:
1. She has to pay Rs. 20,000 as her capital and Rs. 17,000 as her share of Goodwill for 1/5 th share in future profits.
2. The amount of Goodwill to be retained in the business.
3. Plant and Machinery and Stock in trade to be depreciated @ 10% and 5% respectively.
4. A provision of 6% on debtors be made for Bad and Doubtful debts.
5. Furniture is to be revalued @ Rs. 3000.
Prepare Profit & Loss Adjustment Account, Partners capital Account and Balance Sheet of the firm after the admission of Manjusha.
Ans. Profit and Loss Adjustment Account: Loss: 4000, Balance sheet total = 1,10,000, Bank A/c Bal. 42,000, Capital Account: Subha : 44000, Leena : Rs. 29,600, Manjusha : Rs. 21,000

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