Following is the Balance Sheet of Kusum, Sneh and Usha as on 31st March, 2019, who have agreed to share profits and losses in proportion of their capitals:

Liabilities Amount (Rs.)AssetsAmount
Capital A/c : Land and Building4,00,000
Kusum – 4,00,000 Machinery6,00,000
Sneh 6,00,000Closing Stock2,00,000
Usha – 4,00,00014,00,000Sundry Debtors – 2,20,000
Employees’ Provident Fund70,000Less: Provision for Doubtful Debts – (20,000)2,00,000
Workmen Compensation Reserve30,000Cash at Bank2,00,000 
Sundry Creditors1,00,000  
 16,00,000 16,00,000

On 1st April, 2019, Kusum retired from the firm and the remaining partners decided to carry on the business. It was agreed to revalue the assets and reassess the liabilities on that date, on the following basis:
(a) Land and Building be appreciated by 30%.
(b) Machinery be depreciated by 30%.
(c) There were Bad Debts of Rs. 35,000.
(d) The claim against Workmen Compensation Reserve was estimated at Rs. 15,000.
(e) Goodwill of the firm was valued at Rs. 2,80,000 and Kusum’s share of goodwill was adjusted against the Capital Accounts of the continuing partners Sneh and Usha who have decided to share future profits in the ratio of 3: 4 respectively.
(f) Capital of the new firm in total will be the same as before the retirement of Kusum and will be in the new profit-sharing ratio of the continuing partners.
(g) Amount due to Kusum be settled by paying Rs. 1,00,000 in cash and balance by transferring to her Loan Account which will be paid later on.
Prepare Revaluation Account, Capital Accounts of Partners and Balance Sheet of the new firm after Kusum’s retirement.


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