1.

Following is the Balance Sheet of X, Y and Z as at 31st March, 2018. They shared profits in the ratio of 3 : 3 : 2. On 1st April, 2018, Y decided to retire from the firm on the following terms: (a) Stock to be depreciated by ₹ 12,000. (b) Advertisements Suspense Account to be written off. (c) Provision for Doubtful Debts to be increased to ₹ 6,000. (d) Fixed Assets be appreciated by 10%. (e) Goodwill of the firm, valued at ₹ 80,000 and the amount due to the retiring partners to be adjusted in X’s and Z’s Capital Accounts. Prepare Revaluation Account, Partners Capital Accounts and the Balance Sheet to give effect to the above.

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