1.

The Balance Sheet of Madhu and Vidhi who are sharing profits in the ratio of 2 : 3 as at 31st March, 2016 is given below: Madhu and Vidhi decided to admit Gayatri as a new partner from 1st April, 2016 and their new profit-sharing ratio will be 2 : 3 : 5. Gayatri brought ₹ 4,00,000 as her capital and her share of goodwill premium in cash. (a) Goodwill of the firm was valued at ₹ 3,00,000. (b) Land and Building was found undervalued by ₹ 26,000. (c) Provision for doubtful debts was to be made equal to 5% of the debtors. (d) There was a claim of ₹ 6,000 on account of workmen compensation. Prepare Revaluation Account, Partners Capital Accounts and the Balance Sheet of the reconstituted firm.

Answer»

aluation Account, Partners CAPITAL Accounts and the Balance SHEET of the reconstituted firm are calculated below:EXPLANATION:Given,Madhu and Vidhi sharing profits in the RATIO of 2 : 3 Their NEW profit-sharing ratio will be 2 : 3 : 5 after Gayatri became a partner.Calculation of Gayatri's Share of Goodwill Gayatri's share Calculation of Sacrificing Ratio The sacrificing ratio is calculated using the following formulaSacrificing Ratio = Old Ratio - New Ratio Madhu Vidhi



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