C and D are partners in a firm sharing profits in the ratio of 4:1. On 31st March, 2016, their Balance Sheet was as follows: On the above date, E was admitted for 1/4th share in the profits on the following terms, (i) E will bring Rs 1,00,000 as his capital and Rs 20,000 for his share of goodwill premium, half of which will be withdrawn by C and D. (ii) Debtors Rs 2,000 will be written off as bed debts and a provision of 4% willbe created on debtors for bad doubtful debts. (iii) Stock will be reduced by Rs 2,000, furniture will be depreciated by Rs 4,000 and 10% depreciation will be charged on plant and machinery. (iv) Investments of Rs 7,000 not shown in the Balance sheet will be taken into account. (v) There was an outstanding repairs bill of Rs 2.300 which will be recordd in the books. Pass necessary journal entries for the above transactions in the books of the firm on E's admission.

C and D are partners in a firm sharing profits in the ratio of 4:1. On

1.	C and D are partners in a firm sharing profits in the ratio of 4:1. On 31st March, 2016, their Balance Sheet was as follows: On the above date, E was admitted for 1/4th share in the profits on the following terms, (i) E will bring Rs 1,00,000 as his capital and Rs 20,000 for his share of goodwill premium, half of which will be withdrawn by C and D. (ii) Debtors Rs 2,000 will be written off as bed debts and a provision of 4% willbe created on debtors for bad doubtful debts. (iii) Stock will be reduced by Rs 2,000, furniture will be depreciated by Rs 4,000 and 10% depreciation will be charged on plant and machinery. (iv) Investments of Rs 7,000 not shown in the Balance sheet will be taken into account. (v) There was an outstanding repairs bill of Rs 2.300 which will be recordd in the books. Pass necessary journal entries for the above transactions in the books of the firm on E's admission.
Answer» SOLUTION :REVALUATION LOSS- RS 8,660.

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