The following was the Balance Sheet of Anurag and Bhawna, who were sha

1.	The following was the Balance Sheet of Anurag and Bhawna, who were sharing profits in the ratio of 23 and 13 as at 31st March, 2017:- Capital and LiabilitiesRsAssetsRsCreditors65,900Cash1,200Capitals:Sundry Debtors9,700Anurag30,000Stock20,000Bhawna20,000Plant & Machinery35,000Building50,000¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯1,15,900––––––––––¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯1,15,900–––––––––– On 1st April, 2017 they agreed to admit Monika into partnership on the following terms: - (a) Monika was to be given 13 share in profits, and was to bring Rs 15,000 as capital and Rs 6,000 as share of goodwill. (b) That the value of stock and plant it & machinery were to be reduced by 10%. (c) That a provision of 5% was to be created for doubtful debts. (d) That the building account was to be appreciated by 20%. (e) Investments worth Rs 1,400 (not mentioned in the Balance Sheet) were to be taken into account. (f) That the amount of goodwill was to be withdrawn by the old partners. Pass necessary journal entries and prepare the Revaluation A/c, Capital Accounts and the Opening Balance Sheet of the new firm.
Answer» The following was the Balance Sheet of Anurag and Bhawna, who were sharing profits in the ratio of $\frac{2}{3}$ and $\frac{1}{3}$ as at 31st March, 2017:- $\begin{matrix} Capital and Liabilities & Rs & Assets & Rs Creditors & 65, 900 & Cash & 1, 200 Capitals: & Sundry Debtors & 9, 700 Anurag & 30, 000 & Stock & 20, 000 Bhawna & 20, 000 & Plant & Machinery & 35, 000 Building & 50, 000 ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 1, 15, 900 - -------- - & ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 1, 15, 900 - -------- - \end{matrix}$ On 1st April, 2017 they agreed to admit Monika into partnership on the following terms: - (a) Monika was to be given $\frac{1}{3}$ share in profits, and was to bring Rs 15,000 as capital and Rs 6,000 as share of goodwill. (b) That the value of stock and plant it & machinery were to be reduced by 10%. (c) That a provision of 5% was to be created for doubtful debts. (d) That the building account was to be appreciated by 20%. (e) Investments worth Rs 1,400 (not mentioned in the Balance Sheet) were to be taken into account. (f) That the amount of goodwill was to be withdrawn by the old partners. Pass necessary journal entries and prepare the Revaluation A/c, Capital Accounts and the Opening Balance Sheet of the new firm.

The following was the Balance Sheet of Anurag and Bhawna, who were sharing profits in the ratio of 23 and 13 as at 31st March, 2017:- Capital and LiabilitiesRsAssetsRsCreditors65,900Cash1,200Capitals:Sundry Debtors9,700Anurag30,000Stock20,000Bhawna20,000Plant & Machinery35,000Building50,000¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯1,15,900––––––––––¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯1,15,900–––––––––– On 1st April, 2017 they agreed to admit Monika into partnership on the following terms: - (a) Monika was to be given 13 share in profits, and was to bring Rs 15,000 as capital and Rs 6,000 as share of goodwill. (b) That the value of stock and plant it & machinery were to be reduced by 10%. (c) That a provision of 5% was to be created for doubtful debts. (d) That the building account was to be appreciated by 20%. (e) Investments worth Rs 1,400 (not mentioned in the Balance Sheet) were to be taken into account. (f) That the amount of goodwill was to be withdrawn by the old partners. Pass necessary journal entries and prepare the Revaluation A/c, Capital Accounts and the Opening Balance Sheet of the new firm.

Answer»

The following was the Balance Sheet of Anurag and Bhawna, who were sharing profits in the ratio of $\frac{2}{3}$ and $\frac{1}{3}$ as at 31st March, 2017:-

$\begin{matrix} Capital and Liabilities & Rs & Assets & Rs Creditors & 65, 900 & Cash & 1, 200 Capitals: & Sundry Debtors & 9, 700 Anurag & 30, 000 & Stock & 20, 000 Bhawna & 20, 000 & Plant & Machinery & 35, 000 Building & 50, 000 ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 1, 15, 900 - -------- - & ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 1, 15, 900 - -------- - \end{matrix}$

On 1st April, 2017 they agreed to admit Monika into partnership on the following terms: -

(a) Monika was to be given $\frac{1}{3}$ share in profits, and was to bring Rs 15,000 as capital and Rs 6,000 as share of goodwill.

(b) That the value of stock and plant it & machinery were to be reduced by 10%.

(d) That the building account was to be appreciated by 20%.

(e) Investments worth Rs 1,400 (not mentioned in the Balance Sheet) were to be taken into account.

(f) That the amount of goodwill was to be withdrawn by the old partners.

Pass necessary journal entries and prepare the Revaluation A/c, Capital Accounts and the Opening Balance Sheet of the new firm.

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