Pass entries in the firm’s Journal for the following on admission of a partner:

  • Machinery be reduced by ₹ 16,000 and Building be appreciated by ₹ 40,000.
  • A provision be created for Doubtful Debts @ 5% of Debtors amounting to ₹ 80,000.
  • Provisions for warranty claims be increased by ₹ 12,000.
  • Furniture (Books Value ₹ 50,000) is to be reduced by 40%.
  • Furniture (Books Value ₹ 50,000) is to be reduced to 40%.

Solution :