At the time of admission of a partner Suresh, assets and liabilities of Ramesh and Naresh were revalued as follows:
- A Provision for Doubtful Debts @ 10% was made on Sundry Debtors (Sundry Debtors ₹ 50,000).
- Creditors were written back by ₹ 5,000.
- Building was appreciated by 20% (Books value of Building ₹ 2,00,000).
- Unrecorded Investments were valued at ₹ 15,000.
- A provision of ₹ 2,000 was made for an Outstanding Bill for repairs.
- Unrecorded Liability towards suppliers was ₹ 3,000.
Solution :
