A and B were partners sharing profits and losses in the ratio of 3: 2. Their Balance Sheet as at 31st March, 2018, was as follows:

BALANCE SHEET OF A AND B as at 31st March, 2018

LiabilitiesAmount (Rs.)AssetsAmount (Rs.)
A1,04,000 Sundry Debtors37,600
B52,0001,56,000Less: Provision for Doubtful Debts -(1,600)36,000
Creditors1,54,000Stock 60,000
Employees’ Provident Fund16,000 Prepaid Insurance6,000
Workmen Compensation Fund10,000Plant and Machinery76,000
 Contingency Reserve10,000Building 1,40,000

C was admitted as a new partner and brought 64,000 as capital and 15,000 for his share of goodwill premium. The new profit-sharing ratio was 5: 3: 2. On C’s admission the following was agreed upon:
(i) Stock was to be depreciated by 5%.
(ii) Provision for doubtful debts was to be made at Rs. 2,000.
(iii) Furniture was to be depreciated by 10%.
(iv) Building was valued at Rs. 1,60,000.
(v) Capitals of A and B were to be adjusted on the basis of C’s capital by bringing or
paying of cash as the case may be.
Prepare Revaluation Account, Partners’ Capital Accounts and the Balance Sheet of reconstituted firm. (CBSE 2021)


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