1.

Balance Sheet of X, Y and Z who shared profits in the ratio of 5 : 3 : 2, as on 31st March, 2019 was as follows: Liabilities and Capital₹Assets₹Sundry Creditors39,750Bank (Minimum Balance)15,000Employees' Provident Fund5,250Debtors97,500Workmen Compensation Reserve22,500Stock82,500Capital A/cs: Fixed Assets1,87,500X 1,65,000 Y84,000 Z66,0003,15,000 3,82,500 3,82,500 Y retired on 1st April, 2019 and it was agreed that:(i) Goodwill of the firm is valued at ₹ 1,12,500 and Y' s share of it be adjusted into the accounts of X and Z who are going to share future profits in the ratio of 3 : 2.(ii) Fixed Assets be appreciated by 20%.(iii) Stock be reduced to ₹ 75,000.(iv) Y be paid amount brought in by X and Z so as to make their capitals proportionate to their new profit-sharing ratio.Prepare Revaluation Account, Capital Accounts of all partners and the Balance Sheet of the New Firm.

Answer»

Balance Sheet of X, Y and Z who shared profits in the ratio of 5 : 3 : 2, as on 31st March, 2019 was as follows:

Liabilities and Capital₹Assets₹
Sundry Creditors39,750Bank (Minimum Balance)15,000
Employees' Provident Fund5,250Debtors97,500
Workmen Compensation Reserve22,500Stock82,500
Capital A/cs: Fixed Assets1,87,500
X 1,65,000
Y84,000
Z66,0003,15,000
3,82,500 3,82,500

Y retired on 1st April, 2019 and it was agreed that:

(i) Goodwill of the firm is valued at ₹ 1,12,500 and Y' s share of it be adjusted into the accounts of X and Z who are going to share future profits in the ratio of 3 : 2.

(ii) Fixed Assets be appreciated by 20%.

(iii) Stock be reduced to ₹ 75,000.

(iv) Y be paid amount brought in by X and Z so as to make their capitals proportionate to their new profit-sharing ratio.

Prepare Revaluation Account, Capital Accounts of all partners and the Balance Sheet of the New Firm.


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