Balance Sheet of Madhu and Vidhi who are sharing profits in the ratio of 2 : 3 as at 31st March, 2016 is given below:
| Liabilities | ₹ | Assets | ₹ | |
|---|---|---|---|---|
| Madhu’s Capital Vidhi’s Capital General Reserve Bills Payable |
5,20,000 3,00,000 30,000 1,50,000 |
Land and Building Machinery Stock Debtors Less: Provision Bank |
3,00,000 |
3,00,000 2,80,000 80,000 2,90,000 |
| 10,00,000 | 10,00,000 |
Madhu and Vidhi decided to admit Gayatri as a new partner from 1st April, 2016 and their new profit sharing ratio will be 2 : 3 : 5. Gayatri brought ₹ 4,00,000 as her capital and her share of goodwill premium in cash.
(a) Goodwill of the firm was valued at ₹ 3,00,000.
(b) Land and Building was found undervalued by ₹ 26,000.
(c) Provision for doubtful debts was to be made equal to 5% of the debtors.
(d) There was a claim of ₹ 6,0000 on account of workmen compensation.
Prepare Revaluation Account, Partner’s Capital Accounts and the Balance Sheet of the reconstituted firm.
Solution :
