Accountancy > Accounting For Partnership Firms > Admission Of A Partner
(a) Aryan and Adya were partners in a firm sharing profits and losses in the ratio of 3:1. Their Balance Sheet on 31st March, 2024 was as follows:
| Liabilities | Amount (₹) | Assets | Amount (₹) |
|---|---|---|---|
| Capitals: | Machinery | 3,90,000 | |
| Aryan 3,20,000 | Furniture | 90,000 | |
| Adya 2,40,000 | 5,60,000 | Debtors 80,000 | |
| Workmen's Comp Res | 20,000 | Less: Prov 1,000 | 79,000 |
| Bank loan | 60,000 | Stock | 77,000 |
| Creditors | 48,000 | Cash | 32,000 |
| P&L Account | 20,000 | ||
| Total | 6,88,000 | Total | 6,88,000 |
Dev was admitted into the firm on 1st April, 2024 for 1/5th share in the profits of the firm on the following terms: (i) Dev will bring capital proportionate to his share in the profits of the firm. (ii) Goodwill of the firm was valued at ₹ 2,00,000 and Dev will bring his share of goodwill premium in cash. (iii) Machinery was revalued at ₹ 4,50,000. (iv) A provision for doubtful debts was to be created at 5% on debtors. (v) A liability of ₹ 3,500 included in creditors was not likely to arise.
Prepare Revaluation Account and Partners' Capital Accounts on Dev's admission.
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