|Creditors||36,000||Cash at Bank||15,000|
|General Reserve||36,000||Debtors – 60,000|
|Capital A/c :||Less: Provision for Doubtful Debts – (2,400)||57,600|
|X – 1,80,000||Patents||44,400|
|Y – 90,000||2,70,000||Investments||24,000|
|Current A/c :||Fixed Assets||2,16,000|
|X – 30,000||Goodwill||30,000|
|Y – 6,000||36,000|
Z is admitted as a new partner on 1st April, 2019 on the following terms:
(a) Provision for doubtful debts is to be maintained at 5% on Debtors.
(b) Outstanding rent amounted to Rs. 15,000.
(c) An accrued income of Rs. 4,500 does not appear in the books of the firm. It is now to be recorded.
(d) X takes over the Investments at an agreed value of Rs. 18,000.
(e) New Profit-sharing Ratio of partners will be 4 : 3 : 2.
(f) Z will bring in Rs. 60,000 as his capital by cheque.
(g) Z is to pay an amount equal to his share in firm’s goodwill valued at twice the average profit of the last three years which were Rs. 90,000; Rs. 78,000 and Rs. 75,000 respectively.
(h) Half of the amount of goodwill is to be withdrawn by X and Y.
You are required to pass Journal entries, prepare Revaluation Account, Partners’ Capital and Current Accounts and the Balance Sheet of the new firm.