Alfa, Beta and Gama are in partnership sharing profits in the ratio of 5 : 3 : 2. Their Balance Sheet on 1st April, 2022, the day Beta decided to retire from firm, was as follows:
| Liabilities | ₹ | Assets | ₹ |
| Alfa’s Capital Beta’s Capital Gama’s Capital General Reserve Sundry Creditors |
3,00,000 2,00,000 2,00,000 1,00,000 1,00,000 |
Building Machinery Investments Debtors Stock Cash at Bank |
2,50,000 1,50,000 2,50,000 1,00,000 50,000 1,00,000 |
| 9,00,000 | 9,00,000 |
The terms of retirement were:
- Beta takes goodwill from Alfa for ₹ 30,000 and from Gama for ₹ 40,000 for foregoing his share of profits.
- Stock to be appreciated by 20% and building by ₹ 50,000.
- Investments were sold for ₹ 2,70,000.
- Beta is paid by bank draft.
Prepare Revaluation Account, Partner’s Capital Accounts and Balance Sheet of the new firm.
[Ans.: Gain (Profit) on Revaluation – ₹ 80,000; Amount paid to Beta – ₹ 3,24,000; Partner’s Capital Accounts: Alfa – ₹ 3,60,000; Gama – ₹ 1,96,000 Balance Sheet Total – ₹ 6,56,000.]
Solution:-
